One billion euros until 2023 to transform the agri-food industry and for small and medium-sized enterprises (SMEs) to gain momentum and make a qualitative leap. The new Strategic Project for the Recovery and Economic Transformation (PERTE) of the agri-food sector, an instrument created by the Government to coordinate public-private collaboration, will allocate capital from the Next Generation EU European fund to programs to increase competitiveness, digitization, sustainability and traceability of this industry, to which all kinds of companies belong, from a sheep farm to a packaging plant or a national distributor. More than 95% of these companies are SMEs and a large part operate in rural areas, according to the Ministry of Agriculture, Fisheries and Food.
The real impact of this PERTE
Anna Merino, director of Economics at Strategy&, the Strategic Consulting area of PwC Spain, who will participate in the webinar PERTE Agro-food: how can your farm benefit from European funds?organized through Banco Sabadell’s HUB Empresa, points out: “The grants from the Next Generation EU European fund must contribute to reinforcing the development of the agri-food chain and provide it with the necessary tools to face the environmental, digital, social and economic challenges of the next decade”.
Daniel García, director of the Andalusian and Extremadura offices of the consulting firm Zabala Innovation and an expert in European funds, explains that the purpose of PERTE in the agri-food sector is to modernize this industry, which contributes close to 10% of the country’s gross domestic product (GDP). country and that generates about three million jobs: “The idea is to achieve an impact at the national level and throughout the value chain: primary production, transformation and logistics,” he details.
Through this PERTE, with a minimum impact of 3,000 million euros in national accounting and with the creation of 16,000 new jobs, according to estimates by the Ministry of Agriculture, Fisheries and Food, a model resistant to economic fluctuations such as the derived from the situation caused by the health crisis which, in the words of Fernando Ortega, president of the Commission for Agri-Food Industries of the College of Agricultural Engineers of Catalonia, represented a “challenge for the entire sector, and especially for SMEs”. This expert assures: “Our companies have shown resilience and flexibility, adapting to extreme conditions such as market supply, mobility limitations, staff training or strained logistics chains.”
This PERTE focuses on the two main axes of the Next Generation EU European fund: digitization —with the provision of tools to promote e-commerce and omnichannel— and sustainability —with renewable energy supplies and alignment with the Green Deal ( European Green Deal in Spanish) and the Sustainable Development Goals (SDG) of the United Nations—. This plan coexists in harmony and complements other European aid, such as the European Regional Development Fund (ERDF) or the European Agricultural Fund for Rural Development (EAFRD), and community policies such as the Common Agricultural Policy (PAC).
Specific programs for SMEs
The PERTE of the agri-food sector offers a large number of plans and concrete actions so that SMEs access European aid. These are the most outstanding programs:
- digital-kit. This program offers help to SMEs and freelancers to improve their presence on the Internet with e-commerce tools, social networks and data analytics. It also promotes the digitization of its processes and workplaces, as well as the adoption of cybersecurity measures, among other solutions, Merino details. It is expected that, of the 3,067 million euros with which the European Union (EU) has endowed it, approximately 275 million euros will be allocated to the agri-food sector, with bonuses that will range from 2,000 to 12,000 euros.
- agents of change. Complementary to the Digital Kit, this plan provides agri-food SMEs with agents who advise, teach and accompany them in the digitization process: “These agents train and guide farmers or ranchers on how to improve their exploitation using new tools”, Garcia synthesizes. It is estimated that some 37 million euros will reach the agri-food sector of the 300 million euros with which the EU has endowed this program.
- Renewable energy. For primary production and transformation SMEs, there are different sources of renewable energy whose installation is subsidized by this PERTE. The range is wide, since the amount of aid will depend on the size and activity. An example is the photovoltaic panels that are already being installed in water tanks for irrigation. They are placed on rafts that float on the surface of the deposit, a way of capturing energy without occupying land: “Promote the self sufficiency energetic through these pumping is very interesting given the current price of energy”, adds García.
- Agriculture and livestock 4.0. Grants for the sensorization and automation of agricultural and livestock processes, the introduction of robotics, the implementation of artificial vision systems in production processes, the development of artificial intelligence (AI) solutions and the simulation of processes or digitization measures for the improvement in the efficiency of the processes, as Merino affirms.
- Management of by-products and livestock waste. Subsidies for the reuse of livestock waste and its conversion into green energy such as biogas —fuel for which there is also a specific roadmap in this PERTE—, destined to supply heating or electricity to farms.
Driving projects and opportunities for SMEs
In addition to the specific plans for SMEs, PERTE has several projects that reach all levels of the industry and that account for a large part of the budget. These projects represent 400 million euros of the 1,000 million euros total. They are born with a demonstrative purpose: first they promote a concrete change and, once success has been corroborated, they serve as a mirror for the other actors to launch themselves. Although these programs are usually driven by large-scale companies with a national reach, García explains that SMEs can also benefit: “They give business opportunities to this type of company, either as subcontractors or through smaller-scale projects derived from the original”.
Examples of these actions are the massive digitization of the wine sector, with the use of satellites and data in the production of grapes and wine, or the transformation of the pig industry, which uses technology to improve animal welfare: “There are to promote these transformative projects in which different links in the food chain cooperate, with a comprehensive vision and focusing on consumer needs. In the year 2050 there will be 10,000 million people in the world to feed, and that must be a clear objective”, argues Ortega.
How to access European funds
Carmen MagpieDirector of European Funds at Banco Sabadell, who will also participate in the webinar, highlights that SMEs should analyze their needs and shortcomings first, and then seek professional help to find the program that best suits their business. “Companies must reflect on what Projects they want to undertake to transform their business and make it more resilient”.
For Urraca, a key factor is identifying which grants are most appropriate for each SME based on industry, location, activity and other business criteria.
Public bodies play a crucial role. “The impact of PERTE will be real, although its magnitude will depend above all on the application and the accessibility to european funds”, warns Ortega. As García indicates: “The food clusters, which are within the Ministries of Agriculture, are giving simple and clear information”.
The fluidity in financing, monetary advances and logistics, processes that are often complex if they are unknown, are easier with the intervention of third parties, such as banks. For this reason, it is advisable to have professional advice, such as that of specialized consultants who will accompany organizations throughout the process of planning projects and applying for the European Next Generation EU fund.
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