EU funds 30 April 2019, 11:25am

EU-funded irrigation development projects raise interest in Hungary

Portfolio

Almost a quarter of the estimated 1,000 irrigation system development projects funded by the European Union have already been awarded in Hungary, according to a recently published tender documentation.

The documentation for the “Development of the agricultural water management sector" (VP2-4.1.4-16) EU project has been changed. One of the key changes was made to the annex titled eligible activities and their maximum eligible expenses.

Total budget of the tender is HUF 49.57 billion, and the funds are to be distributed between several areas to winning projects currently estimated to total 1,000. Non-refundable subsidies are capped at HUF 1 billion in the case of individual investment projects and at HUF 2 bn at collective investments.

The National Bank of Hungary (MNB) has also urged the development of the irrigation system in the country, saying it could increase crop yields and help stabilise economic growth.

According to the current state of the funding database, 627 applications for subsidies have been submitted so far, with total asked grants of HUF 31.4 billion, i.e. the HUF 49.57 bn budget is not yet depleted. Authorities have green-lighted 227 of these in the value of HUF 8.3 bn. Payments were made in 38 projects to the tune of merely HUF 557 million.

Irrigation system at work on a field close to Hajdúszovát on 4 April 2019. The Hungarian Chamber of Agriculture estimated earlier that revenues to the magnitude of a hundred billion forints could be lost by local farmers due to droughts. As a response to the national drought situation, the government has extended the water usage period as of this year, in which farmers are given access to irrigation water at discount prices.

According to the project finder application, 237 projects have received funding (i.e. there’s a gap between this database and the one we mentioned above), typically HUF 20-50 million, for the establishment of smaller irrigation equipment or irrigation systems, but some of them received grants of several hundred million forints. The largest subsidised project was the irrigation project of LINEÁR-AGRO Mezőgazdasági Ltd. in Nagyecsed, to the tune of HUF 423 million. The second largest funding was won by Tarnamajor Ltd. (a water-efficient irrigation project) in Terem (HUF 352.5 mn), and the third largest subsidised project belongs to Skamla Land Ltd. (irrigation system) which was granted HUF 346.6 mn in Kamond.

You are welcome to write to Portfolio’s EU Funds column (to uniosprojekt@portfolio.hu) about statements released regarding projects co-funded by the EU to the tune of over EUR 1 mn (cc. HUF 320 mn). Under a media tender invited by the European Commission and won by Net Média Zrt., the publisher of Portfolio.hu, we publish these projects on our website.

Cover photo by MTI / Zsolt Czeglédi

This article is part of the work programme titled "The impacts of EU cohesion policy in Hungary - Present and Future" which is carried out by Net Média Zrt., the publisher of Portfolio.hu, between 1st April 2019 and 31st March 2020 with European Union financing. The views in this article solely reflect the opinions of the author. The European Commission as the funding entity does not take any responsibility for the use of information presented in this article.