On the distribution mechanism of green box subsidies

Abstract

Worldwide, agriculture is subsidized. The state is trying to provide financial assistance to agricultural producers. But the WTO framework does not allow these financial flows to be directed in any direction. Support is needed that does not directly affect the formation of prices and does not violate the rules of international trade. Therefore, there is a need to improve the mechanism for the provision of budgetary funding. This immediately invokes a dilemma: to increase the efficiency of their use and to increase the efficiency of production. In agriculture, land is the main means of production. Therefore, the issue of improving the efficiency of land use, and in particular, agricultural land, has received close attention. The system of green box subsidies for crop production, which in Russia since 2013 has been used as a tool of state support for agricultural heat producers, requires further improvement. This type of financing is considered to be unrelated, since it does not define the type of supported products. The funds, in accordance with the new rules, are issued to farms for reimbursement of expenses for conducting agrotechnological field work, improving environmental safety, improving fertility and soil quality, based on the total area of crops. But in the distribution of the regional part of subsides, the methodological approaches for the subjects of Russia have differences that are related to their budgetary support and the attitude of the regional authorities to the agrarian sector. The article proposes the author’s method of allocating budget funds, taking into account the coefficient of costs coverage per unit of soil appraising score. It will enhance the efficiency of their use and, at the same time, increase the efficiency of use of agricultural land. Financing agricultural producers in the region as part of green box subsidies allows them to receive state assistance in a timely manner and gives time to prepare for the sowing campaign in technical and technological terms, as well as to conduct it in the optimum time frame.