Skilling up the Western Balkan agri-food sector

The project was launched by the ETF in 2022 and Skopje was the initiative's second international conference.

Agriculture is vital to the economies of the Western Balkans, where the percentage of land dedicated to agriculture far exceeds the EU average of 40.8 percent. It is 50 percent in North Macedonia and 44.2 percent in Bosnia and Herzegovina.

Employment in agriculture as a percentage of total employment in the region also far exceeds the EU figure of 3.8 percent, standing at 13.1 percent in Serbia, 17.5 percent in Bosnia and Herzegovina, and 36.4 percent in Albania.

It's a key sector for the EU too, with agriculture and food the largest production and manufacturing elements of the European economy, providing over 44 million jobs. The sector is also the focus of landmark EU initiatives, the Farm-to-Fork and European Biodiversity Strategies, which aim to green and digitalise the agri-food value chain and protect the natural world.

But as an ETF background paper prepared for the conference made clear, it's an industry which finds itself at the forefront of the digital and AI revolutions. There has been an exponential increase in patent filings in the agri-tech sector in recent years, soaring from circa 50,000 submissions in 2010 to almost 140,000 per annum today, with serious implications for knowledge transfer: there is often a critical lag between innovation and educational provision.

The conference brought together a range of stakeholders from the Western Balkan economies – entrepreneurs, business support organisations, education and training providers and ministerial representatives – to identify those future skills requirements, analyse granulated research into individual economies, forge connections and partnerships and understand EU funding opportunities.

Opening the conference, ETF Director Pilvi Torsti, said:

"Upskilling and reskilling, in particular at the cross-section of agri-food with digitalisation and greening, is at the core of Western Balkan competitiveness."

Lauding the region’s many "innovative SMEs… bringing new ideas and fresh perspectives", Torsti quoted the European Commissioner for the Internal Market, Thierry Breton:

"SMEs are the beating heart of our Single Market economy, and the ultimate engine of our resilience."

A foresight exercise by Fondazione Giacomo Brodolini revealed the vast range of technological innovations that delegates believed to be priorities for agricultural development: automation, including agricultural robots and autonomous vehicles, big data and predictive analytics, weather monitoring, predictive maintenance, biological fertilisers and pesticides, waste management and so on.

In a real-time, interactive survey, the number one challenge identified by participating delegates was the lack of alignment between the agri-food sector and the training curricula: a "slow and limited adaptation of [training] programmes to labour market needs".

In break-out groups, delegates identified other skills required by the sector in the short, medium and long term: genetic engineering, micro- and nano-technologies, robotics, image analysis, data-mining, waste management, metagenomics, gene sequencing and so on.

But as well as those "hard skills", a recurrent theme raised by delegates throughout the conference was the requirement for "soft skills". Presenting the findings of his FIELDS project (a survey of farmers, agri-food companies, foresters and education providers from 12 countries), Professor Jacques Trienekens of Wageningen University (Holland) revealed that of all the training needs listed, the softer, transversal skills often ranked highest: business planning, strategic management and communication.

"Technical skills are very important", he said, "but equally important are soft skills, knowing how to collaborate with suppliers and customers, understanding marketing and nurturing creative thinking. This is what we saw in all countries and in all dimensions."

It was a point echoed by many delegates: the need for problem-solving and for creative and visionary skills.

"One needs that ability to see what is going to happen," said Kacper Nosarzewski, a foresight consultant. "With AI you need to know what to ask and how to ask it, how to identify the problem and transform it into written form. That's quite challenging."

The necessity for creativity within a sector often considered rigidly grounded was underlined by Adeel Tariq, of Finland’s Lappeenranta-Lahti University of Technology (LUT). He spoke about the importance of embedding art within STEM (the “hard” subjects of science, technology, engineering, and mathematics) to create "steam":

"That's how you apply innovation to agri-business, not by ignoring art but by integrating it."

Site visits revealed the degree of innovation and entrepreneurial energy among young companies throughout Skopje: at Greenagro, Tanja Kotevska showed delegates how her family company has evolved from being an animal feed broker into an actual producer, creating their own premixes bespoke to each herd: they combine around 50 components, including vitamins, minerals and amino acids for farmers to add to feeds. Thanks to research with veterinary schools in Türkiye and Spain, the company has now pivoted to producing probiotics (beneficial bacteria or yeasts) for animal feeds, thus helping livestock's digestive systems, immunity and feed-conversion ratios.

Ivan Kungulovski showed other delegates around Bio Engineering, a company that started out building treatment plants for both human and industrial waste, but which has now evolved into producing cutting-edge bioproducts for applications in healthcare, agriculture, forestry and the environment. The firm also offers detailed microbiological testing for the water, food, wine, and cosmetics industries.

Sofia Deceva of Matryoshka demonstrated her ground-breaking wine ice-cream, "Wice". Having invented a method to freeze wine close to zero degrees (rather than the normal -18), Deceva applied for a patent and designed her own production line on the outskirts of Skopje. Her ice-creams – combining fruity flavours with Macedonian Merlot, Chardonnay and Riesling wines – is now revered by Macedonian consumers.

The conference created a space for both formal and informal networking. Vladmir Rudl introduced delegates to Enterprise Europe Network (EEN), describing its 600 centres in more than 60 countries with over 4,000 experienced professionals, including over 100 active members in the agricultural sector.

"The EEN," said Rudl, "offers support in finding business partners, organising B2B meetings, hosting international trade-fairs and providing a partnering database."

But there was also much unfacilitated networking, with delegates swapping inspiring stories of their challenges and solutions: genetically selecting bees to be immune to the varroa mite which is decimating hives throughout Europe; the creation of aquaponic systems to use cray-fish excrement to grow tomatoes; patenting microbial products to improve soil fertility and so on.

Conversations amongst delegates often raised the challenges and difficulties they face: many alluded to the skills shortages in the Western Balkans for highly-skilled labour.

"The lack of a competent workforce is one of our most acute problems,” said one delegate. “There are only 50 graduates in food technology every year." "We are exporting our best people to the EU and further afield," said another.

Another relevant headwind was the serious reputational issue facing countries in the Western Balkans:

"The credibility of Macedonian companies is very low," said Tanja Kotevska, "it's really serious and we need to work on the business image of our country."

Almin Karameni of Sumska Tajna, a major producer of organic berries, garlic and other foodstuffs in Bosnia and Herzegovina, said:

"We're battling prejudices, and we need to break these superstitions."

Karameni described a major European supermarket refusing to buy his produce at €6/kilo, but that an Austrian friend was able to sell the same produce on his behalf to the supermarket at €9/kilo. "'We will not buy from you' was the message."

Many referred also to the difficulties of exporting to the EU due to the stringency of food regulations. "It's right that they exist," said one delegate, "but the cost of carrying out all the required research means I just can't conceive of exporting there." Business support services have not evolved to support Western Balkan exports to the EU.

In describing funding opportunities, Blagoja Mukanov, of AgFutura Technologies, suggested that more and more businesses are looking for Western Balkan partners in funding bids "because we are very skilled but cheaper than our competitors".

Mukanov described the EU's research and innovation fund, Horizon, as "one of the most competitive and complex projects not just within Europe, but the whole world".

"The EU wants to capitalise on the brains within Europe and really engage people that are technologically ready and extremely disruptive, with projects that work on the ground, hold water, have meaning and deserve large-scale piloting."

Mukanov, himself a farmer, also offered intriguing insights into the "information asymmetrics" in agriculture:

"My perception is that digitalising agriculture is a process, not a tool. It's not about the software or hardware. It's actually much more complex because we are dealing with individuals who have their own mode of behaving that is challenging. We often underestimate their [farmers’] behavioural matrix."

The conference closed with the presentation by the ETF's Gordon Purvis regarding the set up of an Advisory Board to support the skilling up of the Western Balkan agri-food sector and to maintain momentum after the formal closure of the project in 2025. The role of the Board will be to share knowledge, analysis and critical thinking.

Board members will include country representatives of the EU's Instrument for Pre-Accession Assistance for Rural Development (IPARD), national smart specialisation working groups and the EU's Joint Research Centre. European Commission representatives from DGs Employment and Social Affairs, Agriculture and Rural Development, and Neighbourhood and Enlargement Relations will also be invited to participate.

The final conference of the project is expected to take place in June 2024.