The Agrifood Sector - Linkages And Driving Effects In The National Economy

In the national economy system, the subsystems of agricultural production (ASPEFV) and of food production (PABT) are “anchored” to other sectors by a series of “backward linkages” and “forward linkages”. Representing, in fact, the intermediary consumption intensity in final production, the backward linkages coefficients per total national economy had a strong descending trend in the period 1989-1998, ranging from 0.653 (maximum level in 1989) to 0.537 (minimum level in 1998). As compared to the total economy average, 34 of the 54 coefficients of backward linkages referring to the transition years 1990-1998 (62.9%) are larger than unit, referring to four sectors: food industry (PABT) and the rest of branches (RRAM) with 9 coefficients each, on the one hand; the textiles and ready-made clothes (TEXC) and hotels, restaurants and tourism agencies (HRAT) with 8 coefficients each, on the other hand. At the same time, only 16 coefficients of the forward linkages out of the 54 calculated for the transition years 1990-1998 (29.6%) are larger than unit and refer to two sectors: agriculture (ASPEFV) – 7 coefficients and the rest of branches (RRAM) – 9 coefficients. One may notice the presence of strong backward linkages in a number of four branches of the six branches considered, out of which food industry can be easily explained, if we consider that agriculture is the main upstream supplier of food industry. Also, one may observe the presence of strong linkages in only two of the six branches, out of which agriculture can be easily explained if we consider that the main beneficiary in the downstream sector of agriculture is food industry. While agriculture (ASPEFV) is found in the type III of linkages (weak backward linkages but strong forward linkages) in eight of the ten years of the investigated period and in the type IV of linkages in the remaining two years, food industry is found in type II of linkages (strong backward but weak forward). Per total national economy, the average driving backward coefficients (which is similar to that of forward coefficients) for the period 1990-1998 was 2.355; this means that in this transition period an economic activity unit induced by about 22% less economic activity as compared to 1989. Both main components of the agrifood sector (agriculture – ASPEFV and food industry – PABT) present a considerable decline in the driving effects; their averages in the transition years are by 10.9% and 19.7%, respectively, below the corresponding levels of 1989 in agriculture and by 11.6% and 12.0% in the food industry. Agriculture would induce from 1.935 to 2.353 economic activity units in its upstream sector and from 2.464 to 2.903 units in its downstream sector. It means that, summing up the two driving effects, agriculture would induce more than 4.8 economic activity units, and food industry more than 4.7 units. Over the period 1989-1998, our economy mostly featured (39 out of 60 correlations, i.e. 65%) high driving backward power, where in 12 cases this was also accompanied by a high driving forward power (food industry – 2 cases, and the rest of branches – 10 cases), while in the other 27 cases a low driving forward power (food industry – 8 textile and ready-made clothes – 9, and hotels and restaurants – 10). At the same time, agriculture may be characterized by a low driving backward power, but quite a strong driving forward power; by contrast, the trade features by a low driving forward power.