EU to review CAP reform and plan for 2013

THE Common Agricultural Policy of the new century in the European Union is much more closely geared to helping farmers in their efforts to be competitive.

Mariann Fischer Boel, European Commissioner for Agriculture and Rural Development, said this is one of the dividends of decoupling, which allows farmers to tear up their old subsidy calculations and farm whatever will bring the best returns on the market.

Addressing the Oxford Farming Conference, she said the EU will carry out two exercises in 2008- 2009.

A health check will assess whether the reformed Common Agriculture is working as it should and will make adjustments if necessary.

The second exercise will be an analysis of what the CAP could look like after 2013. This will be carried out as part of a general review of the EU budget.

Ms Fischer Boel said the WTO trade round talks are a reminder to expect import tariffs to continue to fall and that large, low-cost agricultural exporters on more than one continent are eager to take advantage of this tendency.

“The EU will continue to play its part to move the Doha Round forwards in 2007. But whatever happens around the negotiating tables of Geneva, globalisation seems not to have a reverse gear,” she said.

“Goods will probably cross the oceans in ever greater quantities as tastes, technology and supply chains become ever more sophisticated.

“This is not a prophecy of doom. Globalisation need not always be our master. It can also be our servant.

“In the agri-food sector, we may spend a lot of time worrying about Brazil. But how often do we think about countries such as India, where we tap into only a fraction of the potential demand for wines, spirits and other high- quality goods that we produce so well?

“We should be working hard to pull down the barriers that restrict our presence in such markets. I will have this very much in mind when I visit India in March.

“And of course, closer to home, there are local markets to be cultivated, in which many people will pay more for food and drink which not only has a particular taste but also has fewer ‘food miles’ behind it,” she added.

Ms Fischer Boel said the EU should look at its market instruments and ask whether they help or hinder competitiveness. “Before 2013, we may need to simplify and improve some of them. After 2013, their very existence will certainly come into question.

“This is especially likely if we phase out export refunds — as we have offered to do within the Doha Round — as this would have a knock-on effect on other policy tools. The instruments which could come under the microscope in this way include, for example, intervention and production quotas.

“My personal view is that quotas stifle competitiveness. We need to send out clear signals that milk quotas will go in 2015.”

Ms Fischer Boel also said on the issue of cross-compliance: “Although I have no intention of watering down the principle, of course we all want it to be a system that works.

“This is why the Commission is preparing a report on our experiences of cross-compliance so far. This should be ready around the end of March.

“I will see whether it is possible to streamline the cross-compliance system without losing the goals of this instrument.”