Frontpage News 2014 New agreement abou...

New agreement about growth plan will strengthen the agriculture

2 April 2014

The Danish Bankers Association supports the government's proposal to liberalize agricultural law, so that other than farmers will have better opportunities to invest in agricultural holdings.

The government's Growth Plan for Food is good news for agriculture, which will now get easier access to venture capital.

"An average farm costs approx. DKK 40 million. No matter how skilled the young farmer is, there are very few who can raise the necessary risk capi-tal.
 
Though a farmer - very impressively - has saved up between a half and one million DKK, it is not sufficient to finance a purchase of a farm exclusively by bank and mortgage financing, " says Deputy Chief Executive of the Danish Bankers Association Louise C. Mogensen, and continues:
 
’’A liberalization of the agricultural law can help solve agricultural challenges by providing risk capital, since outside investors are better able to invest in agriculture."
 
The growth plan also contains proposals that will improve the agriculture’s framework conditions. The government proposes that the entire regulation of agriculture will be similar to the rules applicable in neighbouring countries such as Germany, and that the number of border strips is reduced.
 
"Agriculture needs better framework conditions so that the industry can compete successfully and meet the global demand for food. The growth plan provides good practices in that field.
 
At the same time, The Danish Bankers Association encourages the government to address the Natural and Agricultural Commission's recommendations for a more targeted regulation that can really make a difference for the agriculture. Targeted regulation provides the opportunity that the agricultural production can be increased in areas where the natural environment can tolerate it, while production is reduced or altered in the vulnerable natural areas," says Louise C. Mogensen.
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