Romania Mulls Curbing Foreign Land Purchases

Romania's Agriculture Minister on Monday announced intentions to further restrict foreigners  from buying farmland as a way to protect the country’s agriculture.

“Romania will try to restrict foreigners from buying land in the country after December 31, 2013, when Romania is supposed to open up its market, as agreed in the EU accession treaty,” the Agriculture Minister, Daniel Constantin, said.

“We will set up a government agency to check and approve any land acquisition request. This is a model already functioning in other European countries,” he added.

Foreign ownership of land has become a hot issue in Romania. In recent months, the government expressed fears that foreign buyers could take advantage of low land prices and eventually control Romanian agriculture.

The amount of farmland in Romania owned by foreigners has increased by more than 10 per cent in the last year alone, prompting the authorities to consider curbs.

According to official data, foreigners now own over 710,000 hectares of farmland, which is around 8.5 per cent of the country's total farmland.

Of this amount, around one-quarter belongs to Italian citizens, 15 per cent to Germans, and around 10 per cent to buyers from the Middle East.

By law, only foreign companies can buy land in Romania - but that restriction has to be lifted by 2014, and the European Commission has called for it to be lifted even earlier.

Ironically, agricultural land is not seen as an asset by most Romanians, who tend to consider agriculture a thing of the past.

As many as 1.3 million hectares of arable land lie unused in Romania, according to statistics. The total agricultural surface in Romania is 14.7 million hectares, of which 9.3 million hectares are arable.

Almost half of Romania's 19.5 million people still live in rural areas. But agriculture has long lacked investment, while other problems include fragmentation of holdings, property-related lawsuits and obsolete technology.