Bulgaria May Need To Force Land Consolidation To Back Farming - Officials

Around 80% of the arable land in Bulgaria is free from industrial pollutants, which makes it suitable for ecological production and sustainable farming, but its fragmentation prevents the sector from developing the corporate farming practices common in Europe, Agriculture Minister Valeri Tsvetanov told a conference on investment in arable land.

Bulgaria, which set up large Soviet-style farms through forced collectivisation in the 1950s, has returned the arable land, estimated at more than three million hectares, to its former owners or their heirs following the fall of Communism 19 years ago. However, the individual patches of land often are too small to make agricultural production on them cost-efficient.

Unlike Eastern Germany and the Czech Republic, which consolidated their farm land and boosted the sector after the fall of Communism, Bulgaria has made several foreign-funded efforts to consolidate arable land which have had only a partial effect, said Tsvetanov.

“It is very likely that in Bulgaria we will see some kind of enforced exchange of property,” the board chairman of  Bulgaria’s Elana Financial Holding, Kamen Kolchev, told the same conference. The holding group comprises the blue-chip real estate investment trust Elana Agricultural Land Opportunity Fund, launched in 2005.

Tsvetanov agreed, saying that some "repression" would be justifiable for the common benefit.

“This will be a very unpopular step, but it should be taken as soon as possible,” Kolchev added.

Both Kolchev and Tsvetanov agreed that the farming sector can boost Bulgaria's economy, if land consolidation and modern farming, supported by EU funds, become a reality.

The ministry expects to have regulations for financing land consolidation projects under EU programmes as of 2009.

Analysts and economic experts agree that if Bulgaria had a good harvest in 2007 in the place of crops devastated by drought, the country’s economic growth might have been more than two  percentage points above the 6.2% real growth recorded last year.