The government of Israel established a fund to cover guarantees for small and medium farmers applying for loans from the SME Loan Fund.
Payment according to the programme is decoupled from the type or volume of production and is based on the business cycle of the loan taker.
The programme conforms to the general criteria of Paragraph 1 of Annex 2 of the Agreement on Agriculture:
a) The programme is provided through a publicly funded government programme not involving transfers from consumers; and
b) The programme did not have the effect of providing price support to producers.
In addition, it meets the policy specific criteria of Paragraph 11 of Annex 2 of the Agreement on Agriculture:
a) The eligibility for payment is based on objectively demonstrated structural disadvantage, namely a business cycle of ILS 5 million or less.
b) The payment is not related or based on the type or volume of production.
c) The payment is not related or based on prices related to the production.
d) The payment is given only as a 1-off governmental guarantee.
e) The payment does not mandate or designates the products to be produced.
f) The payment is limited to 85% of any unreturned loan.
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