Agriculture finance and credit infrastructure - conditions, policies and channels

Abstract

Agriculture, like all sectors of the economy, needs credit for its development. Experience in OECD countries demonstrates that in a competitive financial environment, profitable agriculture can obtain the credit it needs. Due to the difficulties faced by farmers in transition economies in obtaining access to credit, the OECD has periodically called upon member and transition experts to reflect upon the issues at stake and to share relevant lessons and best practices in the field of agricultural finance and credit infrastructure. This paper reviews the key messages from past work on this subject, including some observations from the Czech experience. These messages pertain to: the essential framework conditions for access to credit; the role of government policy-making, and possible channels for financing the agriculture and rural sectors. The paper then briefly suggests some linkages and implications that may be drawn between the EU enlargement and these three themes.