site.btaApril 15, 1932: Bulgaria Adopts Farmer Protection Act that Offered Relief Amid Economic Hardship

On April 15, 1932, a Farmer Protection Act was published in the State Gazette and became effective. Adopted by the 23rd National Assembly without substantial objections, the law was an attempt to alleviate the situation in Bulgarian agriculture, which had fallen into a crisis as a result of the Great Depression.

Agriculture Minister Dimitar Gichev, who submitted the bill, motivated the need for it as follows: “The great agricultural crisis, which has particularly severely affected the agricultural countries in Central and Eastern Europe, surprised and caught both the state and the agricultural population itself unprepared, under difficult economic conditions. The catastrophic decline in the prices of agricultural products has left our farmers heavily indebted to banks - state and private, cooperatives and individuals. Due to the reduced cash income of farmers, a large part of them are unable to regularly settle their debts. In the last few years, especially at the beginning of 1929, an increasing number of farmers have been selling their estates. The pillar of economic life - agriculture - is shaken. It is necessary to take measures to stop the process of land expropriation and to assist the Bulgarian farmer in his efforts to liquidate his debts.”

Gichev’s address to Parliament during the first-reading debate on the bill on March 9, 1932, shows just how pivotal the role of agriculture was in the Bulgarian economy at the time: agriculture employed 85% of the Bulgarian population, produced three-quarters of material goods and accounted for 94% of Bulgarian exports. 

Dimitar Gichev (1893-1964) was a remarkable figures in the agrarian movement in Bulgaria and had profound knowledge of the Bulgarian countryside. His political fate mirrored perfectly the turbulent political life of Bulgaria at the time. He was tried several times by different political regimes, was a political prisoner for 13 years but also served as an MP and a government minister. 

A study of that time, “A Short History of the Great Depression in Bulgaria”, says that the agrarian crisis was the first and most vivid manifestation of the Great Depression in Bulgaria. “It manifested itself as a brutal decline in the prices of industrial and agricultural products, leading to indebtedness and bankruptcies of rural producers. […] Аgricultural products depreciated by 59%, industrial products by 28%, and the purchasing power of agricultural producers declined by 43%. 

In a bid to preserve their incomes, peasants responded to the falling prices with an increase in production but that led to even greater indebtedness and financial difficulties. 

In this environment, farmers rapidly transitioned to non-cash barter agriculture, abandoning market and monetary mechanisms. 

The 1932 Farmer Protection Act offered measures of relief for Bulgarian farmers. It granted concessions to peasants owning up to 25 ha of land and having a debt of 200,000 leva, incurred by January 1, 1931. The forcible collection of taxes and debts to banks was suspended, debts were reduced by 30% and an option for repaying in installments was introduced. Most importantly: an unalienable property of 4 ha was created. The law guaranteed both the necessary means of production and the necessary means of survival for farmers, with the Bulgarian Agricultural Bank playing substantial role in the process.

This law arguably helped to reduce the worst effects of the Great Depression. The process of farmers losing land was delayed and the proletarianization of the peasantry was slowed down. Peasants cultivating their own land remained a key element in the social structure of Bulgaria and a crucial factor in Bulgarian agricultural production until the very beginning of collectivization, carried out by the communist regime after 1945.