ANNOUNCEMENT 30 Jul 2013

In July 2013, the government of the Russian Federation announced a change in private-sector financial support.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising
Inception date: 30 Jul 2013 | Removal date: 29 Dec 2013
Still in force

Financial grant

On July 30, 2013, the Russian Government approved with Resolution 1345- the disbursement of subsidies to certain crop producers. The disbursement amounts to RUB 25.20billion (USD 770.41 million), RUB 10 billion more than initially planned.

The so-called "decoupled" subsidies shall supportRussian farmers through the budgets ofthe subjects of the Russian Federation. Their purpose is to reimburseexpenses of the Russian farmers related to plant protection, soilfertility, environment safety, and agro-technological activities.


The provision of these subsidies (see related GTA measure Nr 4162below) is part of the sub-programme "Development of the crop sub-sector, processing and marketing of Crops" of the state program for development of agriculture in the period 2013-2020 (Agricultural Programme 2013-2020).

'Decoupled subsidies' is a key concept, introduced by the Agricultural Programme 2013-2020. Within this concept, subsidies will support farmers' income in general, without being linked to any production performance indicators. The introduction of this new concept is necessary, because the WTO rules forbid direct subsidies of supply of agriculture-related goods (chemicals, fertilisers, seeds, fuel) to farmers, which was a common practice in the Russian agricultural policy in the period 2008-2012. The new approach of subsidies' allocation is based on general indicators such as:

  • minimum subsidy per one hectare of arable land;
  • coefficient of the level of intensity of use of the sown area;share of sown area as a percentage of the total;
  • share of sown area as a percentage of the total;
  • indicators of soil fertility.


The signed document has been reviewed on a meeting of the Government of the Russian Federation 25 of July 25, 2013. On this meeting the Prime Minister, Mr Dmitry Medvedev, commented: 'Thereal sector is the basis of long-term development. A range of statesupport measure are foreseen for key sectors of the economy. We aretalking about '...' targeted subsidisation of '...' enterprises as a part ofthe adaptation process related to the WTO accession'.

The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.

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