Farmers: In February the rules on red loans

More than 21,000 and 700 rural cooperatives are expected to benefit from the regulation on them , which is expected to be voted on in February. The arrangement is included in the fundraising bill of the Ministry of Rural Development and Food, recently put into public consultation. It concerns debts of EUR 3.8 billion, as well as frozen assets of more than EUR 1.5 billion, which, if properly exploited, can help solve the issue, according to experts. “With the new provision for the red loans of farmers, we give a real support to those who are fighting daily for production,” said the Minister for Rural Development and Food, Kostas Tsiaras, in a statement to the APE. CORVERSE According to him, the arrangements that come are targeted and fair. In particular, as he said, they provide for specialised management of agricultural loans by special liquidators, ensuring sustainable settlement and protection from abusive practices. With the ability to delete part of the capital, we give a substantial breath to farmers struggling to keep their farms alive.” Mr. Tsiaras added that “the supervision of the Bank of Greece and transparency in procedures ensure fair treatment for all. With this regulation we put an end to a regime that blocked assets and was a brake on the development of the rural economy. Because our goal is to build a future where the countryside does not simply survive, but prospers and starring.” Through the new arrangements considerable support is provided to the agricultural sector as farmers gain viable solutions to their debts, avoiding financial exclusion and making it possible to restart their productive activity. Moreover, the productive potential of farmers will be protected, maintaining access to resources. Most of these loans have been ‘mining’ for years, with many of them coming back since the 2000s. There are not few producers who, in many cases, because of these obligations but also of the non-solving of the issue as a whole, have not been able to have a second chance at developing their professional activity. This results in both farmers and the state being affected. Farmers could not invest and increase their production and hence their income, while the state was losing money by unable to increase exports of products in the primary sector, and the trade balance relating to imports of agri-food products was growing. CORVERSE What is involved in the regulation At the heart of the new framework for the management of red agricultural loans, which will be carried out in cooperation with specialised funding bodies, is the provision of real solutions to producers. Among other things, it will be possible to extend the repayment time, interest rate reduction, interest write-off, impairment or even partial or total write-off of the loan, thus giving the country’s farmers ‘ breath. It is noted that the plan also includes the possibility of refinancing, offering a new start to people who have been struggling under the burden of debt for years. The bill introduces new arrangements for the management of red agricultural loans through special liquidators who have knowledge of the particularities of the industry. They are required to submit operational plans to the Bank of Greece, thus ensuring greater transparency for the whole process. There has been provision for the removal of part of the capital in compromises, allowing more viable solutions for farmers. This is expected to apply in cases where a farmer is unable to pay his loan. Thus, through the new arrangements it can reach compromise solutions, which can include erasure of part of the debt. The operational plans to be submitted by the liquidators, which will be under the supervision of the Bank of Greece, include the strategies for the management of red loans, timeframes and proposed solutions for debtors and the specific arrangements for farmers, aimed at preventing auctions and supporting sustainable arrangements. The aim as highlighted by all sides is to prevent auctions, protect farmers’ productive dynamics and maintain social cohesion in the countryside.