The World Bank has approved US$12 million worth of financial support to Moldova for an agriculture project designed to help fruit producers cope with the impact of Russian import embargoes. 

Moldovan agricultural and food exports to Russia have been subject to import controls throughout 2013 and 2014 with the most affected export items including summer varieties of apples and plums.

Prior to import restrictions, 93% of apple exports valued at US$43.7 million and 80% of plum exports valued at US$21.2 million went to the Russian Federation.

"Moldova's horticulture sector was highly affected by the events of 2013 and summer of 2014, when the country's fruit farmers were no longer able to export their produce to what was a traditional market," says Alex Kremer, World Bank country manager for Moldova.

"The World Bank has worked closely with the Government of Moldova to put in place a robust and targeted compensatory mechanism to support small-scale farmers affected by these restrictions, in order to protect rural jobs and safeguard economic activity."

The US$12 million will be used to provide grants to apple, plum and grape producers with farms of less than 15 hectares who sold their produce domestically for processing in the fall of 2014.

The grants will compensate approximately 50% of the difference between the estimated normal price and the processing sales price in 2014.

Russia banned some imports of Moldovan produce items ahead of the Europe-wide embargo last year, however in February a list of apple producers were given permission to resume export trials subject to stringent controls.

The World Bank adds by helping fruit growers and the rural economy, the new funding will sustain existing gains in the agriculture sector and support the Agriculture Competitiveness Project long-term.

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