Management of Environmental Challenges and Sustainability of Bulgarian Agriculture

Abstract

This paper presents major environmental challenges in Bulgarian agriculture, identifies and assesses specific modes for environmental governance in the farming sector, and estimates prospects for changing environmental performance of farms under conditions of EU integration and Common Agricultural Policy implementation. We adapt the framework of the New Institutional and Transaction Costs Economics, and assess the efficiency of diverse market, private, and public modes for environmental governance. Our analysis of the post-communist transformation of agriculture shows that it has changed the state of the environment and brought some new challenges such as degradation and contamination of farmland, pollution of surface and ground water, loss of biodiversity, and significant greenhouse gas emis- sions. Badly defined and enforced environmental rights; a prolonged process of privatization of agrarian resources; use of farming practices that do not motivate long-term investment; high uncertainty assets with low frequency specificity inappropriate for environmentally related transactions—all of these factors are responsible for the failure of market and private modes of environmental management. The strong need for public intervention has not been met by effective government, community, or international assistance; consequently agrarian sustainability has been compromised. The assessment of possible impact of EU CAP implementation under Bulgarian conditions indicates that the main beneficiary of various new support measures will be the biggest operators. Income, technological and environmental discrepancy between different farms, sub-sectors, and regions will be further enhanced.