Mr President,
Excellencies,
Ladies and Gentlemen,

It is my great pleasure, in the name of the Macedonian Minister for Agriculture, Forestry and Water Economy, as well as in the name of the Government of the Republic of Macedonia, to express our best wishes for a successful Session.

I am deeply confident that the Twenty Fifth Session of the Governing Council will further facilitate the exchange of views of the best practices to assist to the rural population in terms of overall concept, and also in relation to more detailed aspects and mechanisms depending on country circumstances.

I am glad to see that the recent IFAD's Strategy Paper as a part of the overall strategic objective in the Central and East European Countries continues to give a high priority to the development of rural financial services as a fundamental precondition for sustainable economic growth.

I would like to express my appreciation for the support extended by IFAD in my country effort to deliver sustainable lending programs in rural areas of the Republic of Macedonia that will lead to rural poverty reduction.

As it is well known, the military actions, started in the spring of 2001, forced the inhabitants of the affected regions to abandon their homes. Because, in the largest part of the affected areas, the main occupation of the population is agriculture, the farmers left behind all their properties (houses, domestic animals, sowed crops, mechanization, etc.). The domestic animals roamed around the fields being killed very often. There was no harvest. The planted crops were not harvested; some of them were burned or stamped down by the military formations. The agricultural equipment was almost destroyed.

This misfortune happened together with a draught unprecedented in the last fifty years. The draught, in certain regions, partially or completely ruined some crops. The early spring frost, in some regions badly damaged the vines and the orchards. So in the same year we experienced military actions, draught and early frost. Our farmers use to say: "The misfortune never comes alone". These situations confirm it. Despite the mentioned constraints, the continuation of the IFAD-financed operations in the Republic of Macedonia proved to be of great assistance for our agricultural development.

The lending program has become increasingly diversified and focuses on improving farm incomes in the areas that are in difficult economic and social conditions. This is being accomplished through the provision of credits and associated services for the rural communities through the Southern and Eastern Rural Regions Rehabilitation Project (IFAD 1).

This project is the first intervention of the International Fund for Agricultural Development (IFAD) in the Republic of Macedonia, which has started with credit delivery in July 1998.

Total project costs are estimated at USD 10,0 million with IFAD loan about USD 7.6 million (SDR 5.65 million). Contribution from the Government is approximately USD 0.7 million and USD 1.7 million contribution from the beneficiaries. The project has established a structure for the provision of credit on commercial terms and through commercial banks, for improved agricultural and livestock production within the private rural smallholder sector.

Future IFAD activities in the Republic of Macedonia

In view of the experience gained from the first IFAD Project and that of other Government and donor funded programmes, and considering the strong and largely unsatisfied demand for agricultural credit, IFAD responded positively to the request by the Government of the Republic of Macedonia for the realization of the second IFAD project, the Agricultural Financial Services Project (AFSP). The overall goal of the IFAD 2 project is to raise the standard of living of target population through increased economic activity, responsive to and suitable in the emerging market context, and the establishment of a long-term linkage between the target population and the formal financial sector.

Respected participants, I would like to end my speech by presentation of some of my personal views for poverty.

Having in mind the reasons for the poverty and the different structure of the people, and their distance from the agriculture, the priority should be given to education and training of agricultural managers through the development of:

• Research centres in rural areas and through the technological questions
• Rural entrepreneurial zones
• Entrepreneurship with the agro-business
• Governmental and non-governmental organizations
• Centre for development of small economies
• Small-scale centres for industrial services
• Rural "incubators"
• Activities for development of rural entrepreneurship

My second view that could contribute to increased food production includes:

• Forms and ways of organization of private farmers
• Transformation of the co-operatives and the former state owned agricultural enterprises
• Establishment of agricultural association and cooperation of the private farmers
• Organization of mutual market of producers (agricultural stock market)

Now I would like to present some directions of my country's with IFAD:

• Continuation of the cooperation
• Vocational training of the private farmers
• Providing convenient agricultural policies and credit for the farmers to develop profitable production
• Support of any initiative for high quality and healthy agricultural production
• Institutional support
• Women in the rural areas
• Revitalisation of the abandoned villages in rural areas
• Informative system of accounting management for private farmers
• Establishment of central laboratory for quality control of primary agricultural product

All the best and good help us.

H.E. DR. IVAN ANGELOV

Ambassador to FAO-UN and Head of the Mission
Permanent Mission of the
Republic of Macedonia