The Economic Effects of Drought

Romania has been facing prolonged drought, with dramatic effects particularly on agriculture and transports

Valentin Țigău, 17.08.2015, 13:06

The prolonged drought of July and August has created big problems for Romanian farmers, who say their crops are compromised on hundreds of thousands of hectares, in most regions of the country, the total volume of losses exceeding 2 billion Euros. Meteorologists say it should rain uninterruptedly for two weeks, for the underground water reserves to reach normal levels again.

According to official data, this is the longest period of extreme heat and drought registered in Romania in recent years. With the exception of few counties in the centre and the north of the territory, all others have been affected. The situation is worsened by the lack of an irrigation system, which could have made the difference. At present, only 300,000 hectares of land can be irrigated, as compared to 3.3 million in 1989.

In this context, the Romanian government is ready to pay compensations to the farmers whose crops have been severely affected by drought. Prime Minister Victor Ponta has said the situation does not look very dramatic in the case of wheat crops. In exchange, maize crops are the most affected. The prime minister has underlined that the effects of this summers drought will be felt until the end of the year, and these should be compensated by measures to stabilise other branches of the economy, as well, in order to sustain the upward course of the economy.

As of this summer, Romanian farmers might also receive damages from the EU solidarity fund, to offset their losses. To that end, the Romanian government should however provide the European Commission with exact data on the consequences of this prolonged period of extreme heat, without precipitations, the EU Commissioner for Regional Development, Corina Cretu has said.

Drought affects not only agriculture, but also transport on the Danube, which has been restricted because of the alarmingly low level of the river. Sea transporters have to reduce speed, particularly in critical areas. Furthermore, deep draught vessels have to transfer a part of the cargo on smaller ships, to be able to cross the areas with low water depth. Many ships are blocked on the entire course of the Danube, an important transport route for oil and grains from the east to the west of Europe.

Drought also impacts fisheries and tourism in the Danube Delta, where access is rendered difficult on canals and lakes. The inhabitants of this unique area in Europe, included by UNESCO on its list of World Heritage Sites, are facing substantial losses, and have called for the support of the authorities to reduce their fishing quotas.