The strategy of agriculture and rural development of the republic

2) Retail prices until 2006;

4) External and Internal;

5) The average of the period;

Source: The National Bank of Serbia

2.1.2. Importance of Agriculture in the National Economy

During the transition period, there were no significant changes in the economic structure in Serbia. Since early 2000, the contribution of agriculture in GDP was declining, primarily as a result of faster growth in activity in the non-manufacturing sectors (primarily in trade). However, the share of agriculture in GDP of the Serbian economy is still very high and in 2012 it was 10.1%. Comparing to the average of EU-27 countries, Serbia has a significantly higher share of GDP coming from the agricultural sector in total GDP, and significantly lower share of the service sector. The high share of agriculture in the basic macroeconomic aggregates in Serbia, in comparison to other countries, can be attributed to the rich land resources and favorable natural conditions for agricultural production, and on the other hand to slower process of structural reform in the rest of the economy and delays in that process.

Table . Macroeconomic indicators of agricultural contribution to the national economy

However, absolute employment in agriculture is recording high rate of reduction (the 2012 compared to 2004 was lower by 56%), the share of employment in agriculture in total employment in Serbia is still very high, among the highest in Europe, approximately 21%. Contrary to expectations, since the beginning of the economic crisis, employment was being reduced in agriculture, which, as a rule, in the conditions of crisis absorbs surplus labor force from other sectors. This can be explained by the high proportion of employees in seasonal and temporary jobs in agriculture, which are very sensitive to fluctuations in the labor market during the crisis.

Since 2005, foreign trade exchange of agricultural products and foodstuffs in Serbia has positive and growing balance. The share of agri-food products in total exports reached about 23%, and from 2005 to 2011 it had increased by additional 7 percentage points. Imports of agricultural and food products account for about 7% of total imports, and since 2005 is increased by less than one percentage point.

2.2. Condition of Resources and Environment

2.2.1. Land

Size, Structure and Quality of Land Resources

Republic of Serbia has 5.05 million hectares of agricultural land, out of which 73% of the area are used in the intensive way (in terms of arable land, orchards, and vineyards), while 29% of agricultural land consists of natural grasslands (meadows and pastures). The main part of the agricultural land, or 3.279 million hectares, respectively 65%, is used in the form of arable land, out of which about 7% is not used in one year (it remains in the form of fallow or uncultivated land). In addition to the areas that are left as fallow, significant part of the area under meadows and pastures is not used due to the inaccessibility, weediness or due to economic unprofitability. It is estimated that each year between 200 and 350 thousand hectares of arable land and meadows are not used, while the area of ​​unused farmland with pastures is significantly higher.