Economic Implications of Digitalization and Smart Agriculture in Romania: Opportunities, Challenges and Policy Perspectives

Abstract

The transition from traditional farming to smart agriculture represents a critical imperative for the modernization of Romania’s rural economy. This study aims to analyze the economic implications of digitalization within the Romanian agricultural sector, identifying both the opportunities for growth and the structural challenges impeding technological adoption. Employing a systematic thematic review of existing literature and policy frameworks, the research evaluates current market dynamics, technological applications, and the impact of European Union funding. The findings reveal a distinct economic dichotomy: while digital technologies such as precision farming, IoT, and AI-driven analytics offer significant potential for optimizing resource use and reducing operational costs, their adoption is largely confined to large-scale commercial entities. Conversely, the sector remains dominated by fragmented small-scale farms that are hindered by severe infrastructure deficits, financial barriers, and a digital skills gap within an aging workforce. The analysis further indicates a disconnection between high-level policy objectives and the practical ability of smallholders to access necessary funding. The study concludes that passive technological diffusion is insufficient; ensuring long-term food security and market competitiveness requires a coordinated ecosystem approach that prioritizes targeted digital literacy programs and accessible financial mechanisms to bridge the widening rural-urban digital divide.