RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/ACC/SPEC/CGR/1/Add.2 
17 July 2007 
 (07-3021) 
Working Party on the 
Accession of Montenegro Original:   English 
 
 
 
 
ACCESSION OF MONTENEGRO 
 
Domestic Support and Export Subsidies in the Agricultural Sector  
 
Addendum  
 
Questions and Replies 
 
 
 The following submission, dated 16 July 2007, is being circulated at the request of the 
Delegation of the Republic of Montenegro.   
_______________ 
 
 WT/ACC/SPEC/CGR/1/Add.2 
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  Question 1 
We appreciate the opportunity to discuss Monten egro's agricultural supports and subsidies for 
the period 2002-2005. 
It is evident that much work went into compiling the support tables and we appreciate the 
thorough work done by Montenegro. 
Our assessment of this information is focu sed on achieving a good understanding of the 
Montenegro system. 
Which three years does Montenegro plan on using as its base period? 
Answer: 
 
We are very glad to notice that very positiv e opinion on Montenegrin Domestic support to 
Agricultural sector is expressed in the General Points .  That is in accordance what we had foreseen, 
since Montenegro has domestic support to agriculture  mainly through the measures of the green box. 
Although, the support measures in table DS:6 of WT/ACC/4 (Product-Specific Aggregate Measurements of Support:  Non-Exempt Direct Payments), except relatively small budget line 
directed to tobacco production (1 per cent of total agriculture budget), have many elements of green 
box support.  The share of total amount of green box measures in total Domestic support to 
agriculture is more than 80 per cent in every year for which Montenegro has already submitted 
WT/ACC/4 (2002-2006).    
The approach to support sustainable agriculture  through the programs directed to the Rural 
Development and Public services for the Agricu lture, with minimum support through market-price 
policy measures, was clearly expressed in the new stra tegy, titled:  ''Monteneg ro's agriculture and the 
European Union – Food Production and Rural Devel opment Strategy'', adopted in July 2006. The 
Strategy proposed Concept of the sustainable de velopment of agriculture with strong emphasis on 
appropriate balance between ec onomic growth, environment pr otection and social policy. 
Multifunctionality of agriculture is the core princi ple of the concept. The Strategy pointed out 
necessity of the reforms in three main directions:  (a) Agricultural policy - gradually implementation 
of the new instruments of Common Agricultural Policy of EU; (b) Legislation reforms - 
harmonization of the law regulations with Acquis co mmunitaire EU, and (c) Institutional reforms - to 
build up institutional capacities capable for impl ementation of the new policy and regulation. 
In the General Points, the last question was related to  the base period that Montenegro is going to use. 
Since we have quite stabile agricultural policy with very small amber box measures, which gives 
symbolic amount of current total AMS, whichever period is used we would have more or less the 
same structure of domestic support.  In order to ha ve latest information, Montenegro decided to use 
three-year average 2004-2006 as its base period. 
Based on that decision, a new WT/ACC/4 document was submitted to the WTO Secretariat in 
June 2007.   WT/ACC/SPEC/CGR/1/Add.2 
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  - Supporting Table DS:1 (Green box measures) 
Question 2 Under environmental programs the provision of olive tree seedlings for inaccessible mountain 
regions, what happens to the olives?  Are they harvested and marketed?  
Answer: 
 
Since Montenegro submitted WT/ACC/4 tables for th e new period (2004-2006), in which there is no 
this kind of support, this qu estion is no longer relevant.  
Question 3 
Please explain how the environmental programs for sheep, goat and cattle genetics functions 
and who the beneficiaries of the programs are.  
Answer:  
Animal genetics resources are extremely important  for the whole biodiversity of Montenegro, 
especially if we bearing in mind richness of species and breeds of domestic animals, mainly ruminants and equines.  In order to manage sustainable us ing of these resources and to protect rare breeds from 
extinction,  Montenegro is providing certain incen tives for breeders who accepted to continue rearing 
pure-breed local breed of cattle Busha, local coar se wool sheep breeds Zetska zuja, Bardoka and 
Pivska pramenka:  and Balkan dom estic breed of goats.  Mentione d and other breeds are extremely 
important not only for the livestock sector but fo r the whole country, as a national wealth and 
heritage.  
Beneficiaries are farmers who are ready to rear these species and breeders and who are included in the 
national program for animal genetics resources.  They are eligible to ge t incentives per head of 
animals (€100 per animal of cattle and €15 per sheep or goat) if they meet certain criteria.  The most 
important criteria is to keep pureness of local breeds by not using mixing them with commercial breeds. In addition to the farmers, Biotechnical In stitute Podgorica, as the implementation agency, is 
also receivers of part of this support for the research and managing of the national program of animal genetics resources. 
Question 4 Please provide further information on how funds  are distributed for national campaign for 
Marketing of Montenegrin agricultural pr oducts and what products are covered. 
Answer: 
 
The Ministry of Agriculture, Forestry and Wate r Supply through the program ''Improvement of 
Market Position of Montenegrin Agriculture Products'' promotes domestic products through fairs and 
exhibitions (on local, regional and national level), the campaign ''Made  in Montenegro'', improvement 
and construction of market infrastructure, and othe r promotion activities.  The program also includes a 
new system of milk payment based on quality, which is obligatory for all milk producers in 
Montenegro, in order to improve milk quality by implementing new quality scheme.  Support for the 
introduction of the quality schemes and international st andards, branding and protection of geographic 
indication and geographic origin of the autochthon ous products, promotion of organic agriculture are 
provided, as well.  The main objective of this pr ogram is to promote specific Montenegrin products WT/ACC/SPEC/CGR/1/Add.2 
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  and strengthen link between agricultu re and tourism as more and more  important driving force for the 
development of agriculture. 
- Supporting Table DS:4  
Question 5 Please provide the data sources for Table 4, including value of production.   
Answer: 
 
Table 1 - Value of production in primary agricultural sector for the market, in 2002  
Kind of products Quantity 
(tons) Unit Price, 
€ Value, 
€ 
Meat        
Beef - all categories 8,500 3,500 29,750 
Sheep and goats -all categories 4,830 4,000 19,320 
Pork 3,850 3,000 11,550 
Poultry meat 2,854 1,900 5,423 
Meat  – total 19,255   66,043 
Egg 125,000 80 10,000 
Trout and other kind of fish 2,180.50 2,500 5,451 
Milk (thousand litres)       
Cow's milk (thousand litres) 200,000 280 56,000 
Sheep and goats milk (thousand litres) 25,000 350 8,750 
Milk - total 225,000   64,750 
Fruit 26,002 500 13,001 
Grapes 38,000 600 22,800 
Total - fruit and grapes 64,462   35,801 
Potato 70,421 180 12,676 
Tomato 19,010 200 3,802 
Papers 17,042 300 5,112 
Water melons 32,404 80 2,592 
Other fresh vegetables 41,006 250 10,252 
Total - vegetables 179,883   34,434 
Honey and other bees' products     2,700 
Other agricultural products (cereals, tobacco, 
medic. herbs, decorativ e trees, flowers etc.) - 
lump sum      10,000 
Total agricultural products      229,179 
Source:  Ministry of Agriculture, Forestry and Water Management, March 2003. 
The previous table was used as a base for dete rmination the value of production for the period 
2002-2006 (Table 2).  Please note that products classification in Table 1 differs from distribution the same amount of value (€229,179,450) through the agricultural sectors in Table 2, which were 
supported by the agricultural budget. Value of produc tion for the consecutive years:  2003, 2004, 
2005 and 2006 were estimated based on th e trends performed in these sectors.   WT/ACC/SPEC/CGR/1/Add.2 
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  Table 2 - Value of production 2002-2006  
Sector 2002 2003 2004 2005 2006 
Cattle 41,000,000 42,640,000 44, 772,000 45,667,440 46,124,114 
Milk 64,750,000 66,692,500 70, 027,125 70,727,396 71,081,033 
Sheep 17,325,000 18,018,000 18, 918,900 19,297,278 19,683,224 
Goat 3,825,000 4,016,250 4,217,063 4,385,745 4,605,032 
Stallions   757,120 757,120 757,120 757,120 
Bees 2,700,000 2,808,000 2,948,400 3,007,368 3,067,515 
Grass, lucern 4,970,000 5,119,100 5,375,055 5,536,307 5,702,396 
Ray and 
buckwheat   1,021,600 1,072,680 1,094,134 1,258,254 
Potatoes* 24,675,000 25,662,000 26 ,945,100 26,942,405 27,481,254 
Tobacco 566,000 66 6,000 1,042, 000 1,382,0 00 1,290,252 
Olive         2,850,000 
All agriculture 229,179,450 238,346,628 247,880,493 254,077,505 259,159,056 
*Crops (cereal and vegetables with approximately value of €10 million), which go together with potatoes in 
crop rotations are also included in the total value. 
- Supporting Table DS:6 
Question 6 Please provide further details on the support  program on tobacco and rye, barley and 
buckwheat. 
Answer: 
 
Support program on tobacco 
The Ministry of Agriculture, Forestry and Wate r Management subsidizes production of tobacco by 
providing €0.46 to €0.61 per kg of processed (dried) tobacco, depending on class of quality.  It is 
important to underline that the subs idy per kg has not been increased.  
Reason for this subsidisation is the tobacco pr oduction sector, that was very developed before 
dissolution of ex Yugoslavia, was almost dimi nished during the nineties - period of economic 
sanctions against Serbia and Monteneg ro imposed by International Community. 
Although Montenegro is not reach in agricultural la nd suitable for ploughing; there is quite large area 
close to the Skadar Lake, which gives very good  preconditions for tobacco growing. One of the 
objectives of this measure is to recover this sector, emerging from the previous system with 
unfavourable economic conditions (d uring nineties) for its growth. 
During eighties, Montenegro produced more than 1,000 tons of tobacco annually. Current level of 
production is lag behind, in spite of significant in crease in last several years: production increased 
from 308 tons in 2003 to 506 tons in 2004 (64 per cent increase) and to 636 tons in 2005 (increase 
26 per cent).  
Support program on rye, barley and buckwheat 
This is a new program launched in 2003, with aim at support on growing of rye, barley and 
buckwheat as very unique crops.  Growing of these crops is performed in some parts of mountainous, 
north part of the country.  Because of the inte rest for growing these crops has been increasing, WT/ACC/SPEC/CGR/1/Add.2 
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  problem of supply high quality seeds was appeared, since nobody in Montenegro produces seeds for 
these very rare crops.  
This program provides participation in purchasi ng quality seeds, with level of support from 
30 per cent to 100 per cent, depending on the crops. In  addition to this kind of support, participation 
for purchasing specific mechanization for harvesting these crops is also provided to the amount of 
30 per cent of purchasing price.   
 
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