The upcoming integration of the 10 Central European countries in the European Union and the EU's policy aimed at fighting smoking and reducing the number of tobacco plantations are turning Romania into a target for the acquisition of agricultural land, especially in the eyes of Italian tobacco producers.
Thus, according to a European Commission directive draft, EU tobacco producers will get money to give up producing tobacco in their countries. Therefore, Western producers will be interested in relocating their business, including tobacco-producing operations, to other countries, which are not EU members yet, such as Romania. The Italians are the largest Western producers of tobacco, accounting for more than one third of the total production in the EU.
The European Commission will discuss, in less than two weeks, the proposal to do away with subsidies aimed at the tobacco sector, which annually gets almost 1 billion euros from the EU. The proposal, already passed by the European Parliament, comes at a time of unprecedented actions by supporters of the anti-smoking legislation.
"According to the proposal, some 7,000 euros/hectare/year should be granted for three years to those giving up tobacco growing. This is quite a sum for one hectare of land that owners will continue to use anyway," says Grigore Lioveanu, general manager of Dimon International Tabak Romania, a branch of Dimon Incorporated, the world's second-largest tobacco trader, with annual turnover of 1.3 billion dollars.
Lioveanu says that Italian investors have been making their presence felt on the market of farming land lately.
Adrian Radulescu, chairman of the League of Romanian Agricultural Producers' Associations, has also pointed to the same trend. stelian.negrea@zf.ro
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