The support of the Ministry of Agriculture with grants for farmers in Kosovo has not produced the desired result. Often leading to abuses and injustice. An investigation
(Originally published by Preportr.cohu.org on May 23rd 2016. The version presented here is a shorter version of the original one, available on Preportr web page)
With around 226 million euros invested in the field of agriculture, in the last five years the government did not manage to achieve its objectives related to the reduction of unemployment and the tangible economic growth. The investments in this field were made with no proper feasibility study and the money often went in wrong places. The agriculture sector in Kosovo does not fulfill the needs of its citizens with almost no agricultural produce.
In some reports made by the Ministry of Agriculture related to some particular crops, it is apparent that despite the investments made during many years, Kosovo still imports many agricultural and farm produce. Only potatoes and plums satisfy almost 100 percent of the market demand in Kosovo. In other cases, based on the above mentioned reports as well as those from Kosovo Customs, there is a reduction of import in 2012 and 2013, while in 2014 - 2015 there is an increase of import in many articles such as meat, milk, dairy products, fruits and vegetables. There is a progressive reduction of import of wheat, while the import of flour is progressively increasing.
During the visits of Preportr team, the farmers complained that they are facing difficult conditions and they had no benefit from the Ministry of Agriculture because in most cases they were asked for bribe or to become militants of the party which runs the Ministry of Agriculture.
During its investigation, Preportr found modern stalls funded by the Ministry of Agriculture which were left empty. In those cases, the farmers either sold their livestock or just build the stall and never kept livestock. On the other hand, a considerable number of farmers have no place to keep their livestock. They are forced to keep it in improvised stalls, and in very poor conditions.
There are farmers who won two grants per year and there are also farmers who won grants in two consequent years. Preportr looked into all grants allocated by the Ministry of Agriculture for the 2010-2015 period and found that two people got two grants per year each, one in 2013 and another in 2014, while 54 people won two grants within three years.
Municipalities favored by the ministry
The Ministry of Agriculture did not make public the list of grant beneficiaries. The list of recipients of tractors and other agricultural equipment is not public. Preportr got this list from its sources attached it to the request for access to public documents and, after insisting, the Ministry sent the list of recipients of tractors only for 2013.
This list of tractors, for which a lot of money was allocated, shows that the public money through grants was distributed in Drenica region which is considered as a stronghold of Democratic Party of Kosovo (PDK). Out of 39 beneficiaries from the list of recipients of tractors and other equipment for 2013, 11 are from Drenica (Skenderaj and Drenas). Rahovec, which has a potential for a substantial agricultural development, counts only one beneficiary, as is the case with Suhareka. Peja, which also known as a region with developed agriculture, has only one recipient of tractors and other equipment.
According to the data of the ministry, the allocation of grants was not fair for all municipalities. Among small municipalities, Skenderaj and Drenas benefited the most. These two municipalities benefited even more than the big municipalities such as Mitrovica, Peja, Ferizaj, Gjilan and Gjakova. The following table shows data for all municipalities.
Apart from the list of recipients of tractors, the Ministry also did not make public the collection points such as “ASK Foods”, “Kelmendi GmbH” and “Elkos” which in 2014 got about 3 million euros from the Ministry. The owner of one of those points, respectively “Elkos”, is Ramiz Kelmendi, the MP of PDK. Also, many farmers have declared that they won grants from the Ministry of Agriculture to build stalls and also received tractors and other equipment, but they are not on the lists made public by the Ministry of Agriculture.
In relation to all these findings, Preportr asked to conduct an interview with the minister of agriculture, Mr. Memli Krasniqi, and with the head of AZHB, Elhami Hajdari. The first request was made in April 18, 2016 and even after a month and a half of waiting they have not been keen to respond to this request.
Bribe as mediation to win grants
Agriculture, which is perceived by the government as a sector which generates employment and economic growth, was not supported by any strategy or plan when the government, donors and municipalities invested over 226 million euros. In spite of this big investment, Kosovo did not make any tangible progress in the field of agriculture.
In many cases the abuses are evident. In its fieldwork, Preportr found several farmers who received assistance from the Ministry of Agriculture, and other who received no support whatsoever. In some cases, farmers who received assistance from the Ministry suspended their activity, closed down their farms without providing any accountability.
A stall built in the Municipality of Suhareka has been left empty. Its owner who did not want to identify himself said that he had built this stall partly with its own money and partly with the help of the Ministry of Agriculture. The total investment in this modern stall was around 400,000 euros, according to the owner. It is very spacious, with optimal conditions to keep hundreds of dairy cows and calves. Attached to this space is a special room for milking, with a capacity to milk up to eight cows at a time and the milk is directly stored in a special reservoir. This stall has already been closed down and its owner has sold over 80 dairy cows.
“You cannot do business here; I have invested a lot, see what stall I’ve built, and I had to close it down. The contracting company often changed the prices, what can you do with 25-26 cents per liter of milk; that is even cheaper than a liter of water. There is no place in the world where you sign a contract with a company and, because of snow or due to other circumstances, they refuse to come and pick up the milk, so I often had to throw the milk or give it to my neighbors”, he said.
Some farmers say they were asked money in different ways as a condition to win the grant. They were afraid to disclose their identity due to potential vengeance of the Ministry of Agriculture.
“I won several grants, and for each one of them I had to bribe people, because it is impossible to win a grant without bribing someone. I also bribed people at the municipality to get subsidies, and I also know farmers who bribed other people, but no one dares to talk about this because then it would be impossible to win another grant. When I applied to get a tractor, I was called by this guy who sells tractors to let me know that the tractors had arrived. This happened before I even know that I had won the subsidy. How did he know that I was the winner? I understood this as a message that I should buy the tractor from this guy’s company and that is precisely what I did. I bought the tractor in Fushë Kosova”, this farmer describes in detail how the grant allocation works.
Another farmer from Topillë in the Municipality of Shtime won a grant from the ministry to build a grant to raise calves, in the amount of 27,000 euros. Preportr visited this stall several times. It fulfills all conditions to keep calves, and it was built in a mountainous village of this municipality, but no calf could be found inside. Among the criteria for these stalls set forth by the ministry is that the stalls should be active for three years, while this stall was built by the end of last year. The owner of this stall, Musli Haziri, tries to justify the lack of calves and the many expenses he had to undertake in order to participate for its construction.
Haziri says he is aware of the obligation to have more than 20 calves in the recently built stall, but he says he will reach this number in the future.
While the two stalls of the above mentioned farmers are left empty, many farmers don’t have even elementary conditions to keep cows or calves. They have improvised some old buildings and turned them into stalls, while other improvised stalls with nylons.
One of these farmers is Gazmend Krasniqi, from Qallapek in the Municipality of Peja. The stall where Gazmend keeps his cows is very tiny and therefore he had built two additional improvised stalls where he could keep the remaining calves. The conditions in these stalls are very unfavorable to keep cows both during summer and during winter. Gazmend Krasniqi says that he cannot keep cows in these conditions and he will be forced to sell them. He does not have a special room for milking or the respective equipment and therefore he cannot sell the milk since it resulted unclean.
Last year he was refused a project to build a stall because he did not have the document demonstrating urban permission to build a stall and a copy of the plan. Its project was not even reviewed by the Ministry of Agriculture. He said he was not asked for these document, and when he submitted the documents the officials did not inform him that documents were missing. Gazmend applied several times for a grant but he never won, and for the completion of these project he had to spend as much as 2,700 euros.
"I have applied for a grant to build a stall for four years in a row but I never won; I have 20 dairy cows and 22 calves. I am a very zealous worker, I try not to give up, but without a stall everything becomes very difficult. I don’t know how to stand the current conditions. During winter, the water freezes, I have to bring water in buckets, I have no other but to sell them”, said Krasniqi.
Another farmer who faces difficult conditions is Imer Krasniqi from Baran, Municipality of Peja. He tried to find a temporary solution due to lack of a bigger stall. Krasniqi adapted four small stalls in order to make space for all cows, but the conditions here are very poor. He says he really needs a bigger stall, and if the conditions were better he would increase the number of dairy cows. If conditions stay like this he will be forced to sell the cows and the calves, since he will not be able to keep them.
These difficult conditions were also noted by the commissions of the Ministry of Agriculture, since Imer Krasniqi was one of the winners of a grant to build a stall. On October 10, 2012 he got a written confirmation from the Ministry of Agriculture informing him of the approval of his project in the amount of 25,000 euros.
“According to administrative control, assessment criteria and the field control conducted by the commission, your project meets the criteria set forth in the call for application to initiate the investment foreseen in the project”, states among other things the document of the Ministry of Agriculture. But on January 23, 2013, the Ministry of Agriculture made a decision to refuse the financial assistance, claiming that the application did not finish the works on time, i.e. within 30 days.
Imer says he had to wait for several weeks in order to get the urban permission and the permission to transform agriculture land into construction land due to lots of procedures and failure of the commission to make the respective urban assessment of the building. Imer had started to build the stall, finished the walls and posts, but he had to suspend the works because it snowed and although the commission of the Ministry of Agriculture saw this, they concluded that the work was not finished on time. He made several request to postpone the deadline, but that was not taken into consideration and the stall was not completed. “I won a project but due to very short time foreseen to complete the works I could not finish the construction. The deadline was only 30 days. When I made a request to postpone the deadline I was told that I have to pay 25,000 euros and submit the receipt and this is what I did, but since then no decision has been made”, he says.
Manipulations with criteria and documents
In the mountainous Tërllabuq village of the Municipality of Vushtrria, where almost all residents left and moved to different towns, Aliu family is engaged with farming and agriculture. Thanks to their great zeal and with no state support they managed to have 26 cows and calves, 80 beehives, chicken, turkeys, fields of wheat and other agricultural produce.
Burim Aliu, a young farmer from this village, does not have an adequate stall. However, he built three small stalls where he currently keeps cows and calves. The space in these improvised stalls is so small that it is hard to even feed the cows, let alone to milk them. He says he cannot increase the number of cows due to lack of a bigger stall. “If I was to win a grant I would definitely increase the number of dairy cows and calves; I have had that aim since the time I finished the professional farming school, where I got a lot of training in this field”, he says. His project was refused since he failed to submit the urban permit, which, according to him, was not one of the required documents when the call for application was launched.
“During the administrative control of the application documents of Burim Aliu it was found that the applicant failed to pass the eligibility criteria set forth in the Administrative Instruction and in the Guidelines for Application. The application lacks the following documents: Urban permit from the municipality demonstrating that, in case of winning the grant, the beneficiary will get the construction permit. The applicant did not submit the urban permit. Therefore, taking this into account, AZHB decides to turn down the project”, stands in the document of the Ministry of Agriculture. Aliu says that such document was not required of him when he submitted the application, and he was told that all documents were in order. He can prove this providing the official document issued by the office of AZHB in Mitrovica.
40 years of experience, not enough
Shaip Statovci is around his seventies, but this does not stop him from cultivating apples and other fruits in his backyard. He says that according to the literature he read recently it is best to spray the fruit trees at the end of the autumn, and not as we are used to do, once they blossom. “Those of us who claim to be engaged in agriculture should read at all times, since the science is developing very fast”, says Statovci.
He gives advice to other farmers who ask him how they should act in a certain situations. He doesn’t mind doing this. Despite the vast knowledge in the field of agriculture in general, he was once turned down because “he failed to demonstrate the three-year experience in the field of agriculture, and he did not finish secondary school”.
This passionate farmer in the field of agriculture did not receive assistance from the Ministry of Agriculture. The stall on the corner of his backyard was damaged during the war. Since then, its roof was never recovered from damage, though the walls did not fall apart. Despite the lack of a proper stall until recently he kept 40 dairy cows in a stall made of nylon.
On March 24 2013 he won a grant to build a stall, but when he was about to start the construction everything failed. Statovci insisted to make the investment in the existing stall in order not to incur much expenses, but the condition of the Ministry of Agriculture was to build a stall from scratch, and Statovci refused to do this. He says there was no need to build the stall from scratch. Instead, the existing one could be refurbished in order not to spend a lot of public money.
“I told them this is no way to do the work, demolish an existing structure, and then they introduced refurbishment in their program, but again I was not given the grant, and I think that the reason for this was that I talked about this in the media”, he says.
Preportr also visited the farmers in the Municipality of Vitia. They complained that only few farmers of this municipality received assistance from the Ministry of Agriculture.
An example of the development of agriculture with some state support is the case of Drita Kabashi from Sallagrazhë, Municipality of Suhareka. She received assistance from the Ministry of Agriculture to build a stall and she said this assistance helped her a lot. Kabashi said that before getting the grant she kept the cows in improvised stalls. “Now everything is quite different; I keep the cows in one place and everything is much easier now”, she says.
Though not an easy task, the work of Drita Kabashi has served as a motivation for other women in the village. Despite the difficult conditions Ganimete Vata started working as a farmer since her family had no other income. She loves the work she is doing, but this investment consumes a lot of her energy, and she even said to have had health problems. She has a stall which is improvised with nylon. This stall is far from meeting the basic conditions to keep the caws. “Since they are aware of the difficult conditions I am facing in this enterprise, I hope the Ministry of Agriculture will support me”, she says.
Half of applicants were refused without reviewing their projects
The increase of budget of the Ministry of Agriculture has considerably raised the interest of farmers to apply for grants. The Ministry of Agriculture has very strict criteria when it comes to grant allocation, where most budget goes, but farmers are not very happy both with the allocation and with the way these grants are allocated. They also complain about frequent changes in the administrative instructions, by introducing new criteria, while farmers don’t get informed on time and, as a result, their applications are turned down.
During this investigation, the Preportr team found that the farmers were refused in different ways, but the most frequent cases were of those farmers who were turned down because they lacked a document, which means that their applications were not reviewed at all. Preportr saw the list of farmers who applied for grants in 2015, and only in this year there were 2119 applications, but surprisingly enough 950 applications were turned down. This, expressed in percentage, means that as much as 44.8 percent of applications were turned down. This refusal was justified with the failure to provide all documents. So, due to their mistakes the officials of the Ministry of Agriculture caused all this trouble, and moreover, damaged them financially, since every farmer has two pay between 500 and 1000 euros for a project development. Farmers say there were cases when some were turned done because they failed to submit the copy of their IDs or other documents that can be submitted within a day.
In the Application Guidelines which can be found on the website of the Agency for Agricultural Development, at page 26, in the application procedures it says: in case of lack of a mandatory document, the official of AZHB shall not accept the application.
These guidelines list all required documents except for the urban permit, due to which most applicants were turned down.
The farmers say that even when they had all documents, the AZHB officials told them that some of those were not necessary. Dukagjin Balaj says that he had both the urban project and the business plan the day he applied for a grant to build a stall, but the AZHB official told him those were not needed. Balaj did not win the grant due to the lack of this very document.
Many farmers entered the black list of the Ministry of Agriculture, while others are being investigated. Some of them had their contracts suspended since they did not manage to implement their projects. Preportr got hold of a list with names of five farmers that received tractors and other equipment from the Ministry of Agriculture, for which, in 2014 this ministry submitted a request to initiate investigations at the Directorate for the Investigation of Economic Crime of the Kosovo Police in 2014. The request was submitted on the suspicion of fraud and unreasonable prices presented by these farmers.
The ministry did not grant access to another list of penalized beneficiaries who failed to implement their projects.
The cases of these and other lists – 19 in total – were included in the black list. These individuals, NGOs and companies cannot get a grant from this ministry for a period of three years.
Nexhmi Hyseni from the Municipality of Peja in 2013 got a grant from the Ministry of Agriculture to purchase a tractor and other equipment. He returned from Germany in order to open a farm in his birthplace, but he says he is very disappointed. In 2014 a commission visited him and found that the equipment Hyseni purchased exceeded the amounts set in the price list, and thus he was panelized. He says this is the mistake of the ministry and that he did not manipulate with the price of the tractor.
The irregularities concerning prices when allocating grants for tractors were also found by the Office of the Auditor General.
“According to the Administrative Instruction for grants farmers should submit 3 offers from economic operators and AZHB approves the offer with the lowest price. However, AZHB approved offers from the same economic operators for same tractors (Tumosan 77) but with different prices varying between 32,000 and 51,900 euros ’, says in the audit report.
Although in the last five years a lot was invested in the field of agriculture and husbandry in general, the import of these products did not drop; on the contrary, it was increased for several products. This is also confirmed by Kosovo Customs.
According to these data there was a 3 million euros decrease of red meat import in 2012 compared to 2011 when the import was 16,600,081.00 euros. In the next years, in 2013, 2014, and 2015 the import marked a progressive increase reaching more than 21,5 million euros in 2015. According to a report of the Ministry of Agriculture regarding the meat market, Kosovo manages to meet 69.8 percent of domestic market demands for red meat, while it continues to import around 30 percent of meat and its products to meet domestic demands. The export, according to this report, is very low.
Although millions of euros were dedicated to farmers, the Federation of Kosovo Farmer Unions (FSBK) and agriculture experts say that the situation has not changed for better. They list a number of factors for this situation, such as the fact that the assistance was not given to right people. They say that the grants were given to party militants, people with influence and businessmen linked to parties running the government.
Tahir Tahiri, head of FSBK, says that grants are given more often to those who give bribes. He heard this type of complaints in his meetings with farmers.
“There are certain people who do field visits and give guarantees to certain people that they will get a grant. For this they ask 10 to 15 percent of the total amount of the grant to be allocated to the farmer”, says Tahiri.
Also, according to him, officials who work in the ministry give grants to their relatives, and here we are talking about more than one grant, during three to four consecutive years.
“We know who they are, and we are ready to give information to the Ministry of Agriculture, but they refuse such a thing”, he says.
The state, according to him, did not create an appropriate environment so that the farmers may have lots of benefits from this money which goes to agriculture. “We see the problems faced by milk producers; there are own investments, but also many international investments have been made, but their production was handicapped by the unfair competition of import”, he says.
The professor of the Faculty of Agriculture, Imer Rusinovci, shares a very similar opinion.
Agricultural production, according to him, should be stimulated using incentives – either in the form of investment grants or through direct payments (subsidies), different premiums etc., but there should be a higher level of monitoring conducted by executive mechanisms.
“If those are abused, not only the result will not be tangible but the situation will get even worse”, he says.
According to Rusinovci, the incentives should change and be in line with the EU trends for certain agricultural products, not only in terms quantity but also in terms of quality.
“There is no logic to invest and not get a better result compared to previous situation, since in many agricultural produce we face a regressive trend”, he says.
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