Social and economic transition of agricultural cooperatives in Bulgaria

Topic 24; Stage 5; Micro Socio-economic transformation processes in the last decades in Bulgaria identified new priorities and in general re-shaped political agenda and strategic approach towards economic and social... [ view full abstract ]

Topic 24; Stage 5; Micro

Socio-economic transformation processes in the last decades in Bulgaria identified new priorities and in general re-shaped political agenda and strategic approach towards economic and social development of the country. Domestic policies in line with country peculiar rural character have been introduced consequently to prioritize the role of the small and medium-size farms in rural areas and to ensure secured employment to a significant number of people. Policies and interventions in rural areas are closely interrelated to agriculture, having in mind that 37% of the population lives in 54% of area identified as predominantly rural. Nearly half of the total land (46,1%) is dedicated to agricultural production; however, the average farm size is 5 ha (91%), which is a striking difference with the European Union, where the average farm size is 14,2 ha. A relatively large number of larger and more specialised farms are located in certain regions in Bulgaria, still semi-subsistence and subsistence farming is the prevailing reality in the country. Increased concentration tendency has not only been perceived as favorable condition for intensive farm practices, market-oriented supply and market balance, but also as a source for dealing with the inequalities among the different regions on the bases of their competitive level and development capacity.
From historical perspective agriculture is one of the economic sectors, where cooperative model has been deteriorated and used neglecting its guiding principles for democracy, solidarity and common wealth. Nowadays cooperatives are still observed with precaution and often underestimated not only in terms of their economic potential, but also in their ability to accumulate social benefits for their members and community.
This paper aims to conceptualize cooperative model in Bulgaria, by identifying, analyzing and evaluating the causes of economic and social changes in development and distribution of agricultural cooperatives in the past two decades. Against this background a number of representative agricultural cooperatives that have emerged in different regions of the country, will be analyzed. Particular focus will be placed upon peculiarities of the Bulgarian model of production cooperatives and the problems of functioning in market-oriented environment. Based on expert assessment, the reasons for the rapid reduction of the agricultural production cooperatives, due to internal factors of the organization and the external business environment, will be analyzed. Some reccommendation will be provided on how development of agricultural cooperatives could be translated into development of network of the farming community.