Minister of Agriculture Kaspars Gerhards' responses to questions from zemeunvalsts.lv

So far, you have gained experience in the Ministries of Economics, Transport, and Environmental Protection and Regional Development; does this also help in your new position at the Ministry of Agriculture?

My career path shifted towards the agricultural sector after I finished secondary school and began my university studies. I studied economic planning and agricultural economics, agricultural production technology, and food technology. Furthermore, my diploma thesis upon graduation was on the 1920 agrarian reform in Latvia. As for my previous work experience, all four ministries—Economics, Transport, Environmental Protection and Regional Development, as well as Agriculture—are linked to the national economy. Each ministerial position has provided me with invaluable work experience in the national economy. These sectors complement one another; therefore, while leading the Ministry of Agriculture, I can use the knowledge I have accumulated to take a broader look at the issues and situations that need to be addressed.

For example, development is impossible without an extensive, well-functioning road network. The existence of roads is one of the main prerequisites for business to develop, because business means jobs. In turn, if there are jobs, people do not leave the country. When planning to develop a business, entrepreneurs first look at whether the chosen location has the necessary infrastructure. It is a chain of processes, and the more well-considered the decisions the government makes, the stronger each link in this chain will be. There is a reason for the saying: we are only as strong as the weakest link in the chain.

One of the links that we must take care of, which we must make stronger, is the food industry and agriculture, because these sectors combined provide 19.2% of Latvia's exports, while forestry provides 21.2%. This means that the Ministry of Agriculture is responsible for more than 40% of Latvia's exports! Two sectors—agriculture and forestry—ensure the economic stability of the Latvian state. This is a very significant part of the Latvian economy.

Agriculture and forestry are traditional industries where significant changes cannot be made within a single year. If you want to achieve something, you have to work in the long term. Therefore, my priorities would be: to ensure that any forester or any farmer can forecast their future and investments, because this is not a quick-fix business.

My priority is to ensure that the countryside is alive! That there are people in the countryside and that people in the countryside can earn a living! Specifically, the goal for the next four years is a competitive Latvian producer. This factor is extremely important, as it accounts for more than 40% of our country's exports. I believe there are opportunities to significantly increase the share of agricultural production in Latvia. If we look at the classic foundations of the economy, it is exports that sustain and propel Latvia forward.

You are familiar with what 'Latvijas Valsts meži' and forest owners have achieved in the creation, maintenance, and management of forest infrastructure. What is your impression (opinion), knowing that all this is valued not only by humans but also by the lesser spotted eagle?

First of all, neither an eagle nor a bee lives in overgrown, unkempt meadows and swamps! This means that forests, meadows, and even swamps must be maintained to create an attractive environment for humans, birds, and insects alike.

Secondly, it is necessary to invest work and finance into tidying up the environment and infrastructure, regenerating forests, and creating the prerequisites for maintaining a natural environment. All of this is currently being done by forest owners and 'Latvijas Valsts meži'. The forest industry is one of the most important sectors of the Latvian economy. At present, forests already cover 52% of our country's territory and provide around 20% of the value of Latvian goods exports. In 2018, the volume of products exported by the forest industry exceeded 2.5 billion euros. It is clearly evident that the development of the forest industry is sustainable, and the value of state forests continues to rise.

Thirdly, a balance is needed in nature, so it is important to balance forest management and economic activity with environmental needs, such as habitat conservation, etc. Specifically, when working in forestry, it is essential to observe environmental requirements aimed at maintaining environmental quality, i.e., Latvia's nature. There must be a balance: both a green and clean environment, and the opportunity to work in agriculture, farming, livestock, forestry, fishing, and other fields. The most complex stage is to find and create compromises acceptable to the parties involved. There are many stakeholders in these processes, each with their own requirements, and often diametrically opposed ones. After all, every industry, institution, association, or other representative will stand up for specific values and needs. This is a time-consuming and complex task, but it cannot be an obstacle to the industry's development.

Does the Latvian work ethic matter?

Of course! In the past, our ancestors cleared land with horses and planted forests. Today, I am convinced that Latvians are capable entrepreneurs, both in forestry and agriculture and in other sectors. There are enough examples in the regions where the implementation of a forward-looking and well-considered business plan becomes the foundation for a viable company that provides a living for the entrepreneur themselves, jobs for local residents, and promotes regional development, thereby contributing to both the development of the sector and the region as a whole. It is important to understand that every company forms part of the contribution to the development of the Latvian economy. This means jobs for residents, the production of Latvian goods, taxes for the state budget, the maintenance and management of territories, the promotion of exports, etc. The more we can create an environment that is suitable and friendly for the forestry and agricultural sectors, the stronger, more stable, and more multifaceted an industry we will be able to build.

As Minister of the Environment, you once promoted a bill for the introduction of a beverage packaging deposit system, but the Ministry of Agriculture and the industry were against it. You are now the Minister of Agriculture; what is your and the industry's view on the progress of the deposit system bill?

It must be emphasised that the introduction of a deposit system is necessary for Latvia in order to meet the targets set by the European Union. Consequently, the question is not whether such a system is needed, but rather how to implement it. Firstly, the deposit system must be able to function fully, and producers must be able to ensure the collection and recycling of packaging by making investments of a reasonable size. Furthermore, it is equally important to create a system that is easily accessible and understandable for every resident.

I am very pleased that on 24 April of this year, a memorandum was signed—an agreement between all beverage producers on purposeful cooperation for financial readiness to introduce a deposit system in Latvia for the efficient collection and recycling of packaging. This means that the industry is ready to participate. For them, of course, it is very important to have transparent and clear rules of the game. In any case, the Ministry of Agriculture will support the industry so that they have complete confidence that everything they do is being done in a clear, understandable, and sustainable manner. My conviction has not changed! I am convinced that this is one of the mechanisms for putting the waste management system in order. The deposit system is a very serious step towards a clean and tidy environment.

During the budget approval process, you prepared a proposal that provided for significant changes in relation to compensation for restrictions on economic activity. Please briefly explain the essence of the proposal!

My proposal provided that if any restrictions on activities are imposed on economic operators, appropriate payment (compensation) must be provided for them. If this is not done, it means the state is imposing an obligation on private property that it does not compensate. That is not right! The state must take care of biodiversity, but if a private individual does this due to a state-imposed restriction, it must be appropriately compensated. If income from economic activity is expected to be, for example, 20,000 EUR, but we compensate 600 EUR, how fair is that?

What is needed for the country to develop and for people to live in the countryside?

Cooperation between the state and the industry is important. We are working and will continue to work together with the industry! It is essential to build cooperation with industry representatives and organisations, because only through interaction is it possible to promote full-fledged development. The understanding of processes in agriculture, forestry, and other fields by state institutions cannot be detached from reality, so it is vital to consult and build cooperation with industry professionals. As for lobbying, we will definitely cooperate with representatives at all levels of the industry, not just with one or two separate large organisations.

Cooperation must be comprehensive, which is why we have already started work to achieve an inclusive common good. The ministry's main task is to ensure that life returns to the countryside more and more—both residents and business activity. As one of the possible solutions, I can mention increasing support for companies that are only just starting their operations and creating high value-added products. To ensure the population of the countryside, a range of mechanisms must be found to provide support to small farms, woodworking companies, and home producers.

Support for small farms was already provided in the previous planning period, and LEADER programmes have worked successfully; these things must certainly be continued. If we want the agricultural sector to be export-capable, we must ensure equal competitiveness for all farms. If a person has chosen to live in the countryside, they must have the opportunity to receive various types of support, but at the same time, they must also realise that one cannot live on support income alone.

In the field of regional policy and agricultural policy, the country must do everything possible to ensure that people have the opportunity to work. If a road network is provided, work opportunities are within 10–20 kilometres. But, of course, if out of the 65,000 farms that receive support, the majority are small farmers, this means that even with 100% work in agriculture, they may not be able to provide sufficient income. Studies show that for a farm to be self-sufficient, at least 65 hectares of land are needed for production. The availability of state support in the agricultural sector is essential, which is why it is important not only to maintain this support but also to improve it—in line with current changes in the country and Europe. It is equally important to take into account the farmers' requirements, needs, and capabilities so that, through joint efforts, the best possible solutions can be found for the development of the agricultural sector and support for entrepreneurs. It is currently clearly visible that support programmes are in demand among farmers, and the available co-financing limit for the agricultural land acquisition programme will soon be reached. Taking into account the popularity of this support, we will continue to work actively on improving the programme so that it is also available in future periods. My goal is for a person living and working in the countryside to receive an average salary of at least 1000 EUR and not to feel less valued than a person working in Riga or other cities.

Lately, a lot has been heard about various studies in connection with biodiversity. What is your opinion on these studies, conclusions, and what should be done with it all?

We have many different organisations and studies organised by them. It is important that these studies are scientifically grounded. Of course, they must also be carefully weighed: both their impact and the use of the results. The authors of the study must offer solutions. It must not become just a bureaucratic burden. An excessive bureaucratic burden can turn out to be an inaccessible and overly complex path in reality, thus not only slowing down business and its development, but even, potentially, stopping it completely. Such a situation can arise both due to unfulfillable and unnecessary requirements and also by psychologically 'killing' an entrepreneur's desire to continue or develop their business. It must be taken into account that for a forester and a farmer, like any entrepreneur, it is essential to work or carry out their business in such a way that the company is viable, that it turns a profit, and that development and growth in the local, European, or world market is not just a distant dream. However, if a study on certain processes is scientifically grounded and clearly indicates certain trends, it must be taken into account.