The absorption rate of European funds granted to Romania through the European Agricultural Fund for Rural Development (EAFRD) is currently at 86% in the financial programming period 2014 – 2020, including the transition period of 2021 – 2022.

The percentage represents the value of payments made by the Agency for Rural Investment Financing (AFIR) into the accounts of farmers, processors, entrepreneurs, and local authorities, totaling 10.87 billion euros, reported against the total allocation of 12.7 billion euros.

Out of the total payments made by AFIR, 5.77 billion euros were reimbursed for investment projects selected for funding, while 5.1 billion euros were granted to farmers who benefited from direct payments for environmental and climate measures.

During the financial programming period 2014 – 2020, extended at the European level until 2022, AFIR received 120,689 funding applications for investments totaling 12.5 billion euros. Following the evaluation and selection process, financing contracts were concluded with 96,140 beneficiaries of the National Rural Development Program, totaling over 7.2 billion euros (including projects from the transition periods of NRDP 2013 and NRDP 2020).

In 2023, AFIR paid beneficiaries of investment projects and compensatory direct payments 1.487 billion euros, exceeding the payment forecast for the entire calendar year 2023.

Additionally, on October 15, 2023, the Agency closed the European financial year 2023 (October 16, 2022 – October 15, 2023) with payments of over 626 million euros – the absorption target for NRDP payments for investment measures being 502.6 million euros, which means not only achievement but surpassing the assumed objective. We are thus at 124% completion rate.

"These funds represent our constant commitment to the sustainable development of rural areas. We supported essential projects in agriculture, rural infrastructure, and the diversification of the local economy. Through the technical and financial implementation of EAFRD, AFIR facilitated access to essential resources for rural communities, stimulating innovation, modernization, and competitiveness in the agricultural sector. These payments represent an important step in supporting sustainable economic and social development in rural areas, contributing to the consolidation of modern agriculture and adequate infrastructure for farmers and local communities throughout the country," said George CHIRIȚĂ, General Director of the Agency for Rural Investment Financing.

Up to this point, AFIR has in its portfolio 80,090 completed projects, totaling 4.13 billion euros. Projects currently ongoing, namely 16,050 projects, some delayed due to the impact of the COVID-19 pandemic or the increase in construction material prices, as well as legislative changes in public procurement, must be completed by the end of 2025.

For investment projects that reached a minimum implementation stage of 30% by October 31, 2023, the project execution period may be extended so that the last payment under NRDP 2020 can be made by the deadline, i.e., December 2025.

"At the Agency level, rigorous monitoring is applied to identify projects that can justify the extension of contracts, as well as a series of measures to simplify the reimbursement process for the last payment tranche, especially for projects involving construction and installation works," specified George CHIRIȚĂ.

To determine the eligibility of projects for the aforementioned condition, an analysis is conducted to ascertain if at least 30% of the eligible value has been paid within the project, taking into account both payments made by AFIR to beneficiaries and payments made by beneficiaries to suppliers of goods, services, and works, including advance payments made by beneficiaries to contractors. The advance payment made by AFIR to beneficiaries is not considered in determining the project implementation stage based on the mentioned criteria.

The status of implementation of non-repayable funds provided through PS PAC 2027

Starting from 2023, AFIR manages the Strategic Plan for the Common Agricultural Policy 2023 – 2027 (PS PAC 2027) with an allocation of 5.87 billion euros, of which European Union financing through EAFRD, the European Agricultural Fund for Rural Development, amounts to over 5 billion euros.

In this financial exercise carried out in the period 2023 – 2027, AFIR will manage 38 interventions, financed from EAFRD and the state budget, out of which 11 interventions are for environmental and climate measures delegated to colleagues at APIA, and for which AFIR will make payments, as in the programming period 2014 – 2020.

"We emphasize that in this financial programming, the competition for funds from the Strategic Plan will be significant, especially since potential beneficiaries are well acquainted with the mechanism for accessing and implementing European funds, many of them already having experience with funding managed by AFIR and are prepared. This will translate into increased pressure during the application and selection phase," mentioned the Director-General of AFIR.

The first sessions for submitting funding applications through PS PAC 2027 were launched at the beginning of November this year for interventions DR 27 – Creation/ modernization of agricultural access infrastructure, DR 28 – Creation/ modernization of basic road infrastructure in rural areas, as well as for DR 30 – Support for young farmers' installation.

Funds for young farmers in the mountain area were the first to be depleted, specifically on December 6, 2023, before the session closure date of January 31, 2024. 1,879 funding applications were submitted, with a cumulative value reaching 131.5 million euros, exceeding the set ceiling for this session of 112.8 million euros.

Also, starting from this year, AFIR becomes a multi-fund agency, successfully optimizing its activity and, through considerable efforts of the entire staff, managing in this financial programming period 3 European funds for financing agriculture and rural development:

The European Agricultural Fund for Rural Development (EAFRD) supported by funds from the European Union's Recovery Instrument (EURI), managed by the Ministry of Agriculture and Rural Development (MADR);

The Mechanism for Recovery and Resilience of the European Union (MRR) through the National Recovery and Resilience Plan (PNRR), managed by the Ministry of Investments and European Projects (MIPE) and for the financing of Investment 7 by the Ministry of Education (MEd);

The Modernization Fund through the European Investment Bank (EIB), managed by the Ministry of Energy (MEn).

Additionally, AFIR is also responsible for implementing the National Program for the Development and Support of the Food Industry INVESTALIM, in the period 2023 – 2026 through the INVESTALIM State Aid Scheme, which has a total budget of 590 million euros, provided from the state budget. The annual allocation for project financing is approximately 147.5 million euros.

Session 2023 closed on December 27, 2023, reaching a percentage of applications of over 400% of the total session allocation.

Thus, from the opening of the session on October 27, 2023, 49 applications were submitted requesting over 613 million euros from a total allocation of 147.5 million euros.