Investment opportunities in livestock sector TABLE OF CONTENTS

Investment opportunities in livestock sector

TABLE OF CONTENTS p p p p p Legal framework Structure of livestock sector Favorable regions for animal husbandry Main export markets Challenges Sector priorities Reasons to invest in livestock sector Support mechanisms Investment possibilities

LEGAL FRAMEWORK in the field of investments: p Law on investment in entrepreneurial activity no. 81 from 2004 p Law on public private partnership no. 179 from 2008 p Law on free economic zones no. 440 from 2001 in the livestock sector: p Husbandry Law no. 412 from 1999 p Law on selection and reproduction of animals no. 371 from 1995 p Law on beekeeping no. 70 from 2006

STRUCTURE OF LIVESTOCK SECTOR

FAVORABLE REGIONS FOR ANIMALS HUSBANDRY North region North Due to its climate conditions is more suitable for cattle breeding, Centre and South regions are favorable for breeding of other species South (pig, poultry, sheep, goats)

INSTITUTIONAL STRUCTURE BY TYPE OF PRODUCTS MILK AND DAIRY Milk collecting points (600) Scientific-Practical Instititute of Biotetehnologies in Husbandry and Veterinary Medicine Dairy processing plants Republican Center for Improvement and reproduction of Animals Market chain (supermarket s, agri-food markets, specialized shops) SECTOR INDEXES IN 2010 Cows – 154, 4 thousand heads Production – 591, 2 thousand tones Consumption Processing - 642, 0 thousand tones - 118, 8 thousand tones

INSTITUTIONAL STRUCTURE BY TYPE OF PRODUCTS MEAT (BEEF and SHEEP MEAT, PORK, POULTRY) Beef and Sheep Institute of Biotechnologies (genetics) Animal keepers Bulls/sheep fattening farms Slaughterhouses Meat processing plants Trade chains Production: Consumption: Export (beef): Export (sheep): 19, 6 10, 0 1, 2 1, 3 thousand t t Pork State Enterprise “Moldsuinhibrid” (genetics) Breeding farms Slaughterhouses Meat processing plants Trade chains Production: 73, 2 thousand t Consumption: 52, 5 thousand t Poultry meat • State Enterprise “Avicola Moldova” • Reproduction centers • Broiler Chicken production facilities • Slaughterhouses • Meat processing plants • Trade chains Production: 54, 9 thousand t Consumption: 39, 0 thousand t

MAIN EXPORT MARKETS (2010)

CHALLENGES p Insufficient milk production for processing (Only 30 % of dairies’ capacities are used) p Law level of technological endowment of farms

SECTOR PRIORITIES p Fulfillment of EU sanitary veterinary to be allowed to exports meat and milk products p Attract investments in tehnical upgrading of farms for milk production p Re-launch and diversify export markets re-launch of pork to Russian Federation market) (e. g. to negotiate

REASONS TO INVEST IN LIVESTOCK SECTOR p Attractive factors of production: n n n p Fiscal incentives: n n p Large areas of grassland Favorable climatic conditions High quality of soil Labor force for advantageous cost Lease of agricultural land for long term (up to 30 years) Tax for corporate profits is 0 % VAT exemption in free economic zones Favorable geografical location: n Access to CIS and EU markets

SUPPORT MECHANISMS Upgrading and technological renovation of livestock farms State subsidies Credits at attracting rates provided by IFAD Procurement of breeding animals and keeping genetics Development of livestock and poultry 40 % of cost for equipment for cattle farms 30 % of cost for equipment for other species farms

INVESTMENT POSSIBILITIES p Establishment of milk farms and milk processing plants p Upgrading and technologization of milk farms p Creating farms of fattening and slaughtering of cattle p Genetic improvement of animals p Implementation of Public Private Partnership Projects with Scientific-Practical Institute of Biotechnologies and Veterinary Medicine (in the field of embryo transfer, milk processing, improvement of management practices of animal breeding)