A brave new farming world
Peter Gaemelke (COPA) and Eduardo Baamonde (Cogeca) said in addition to pressure to open up markets, society is placing more demands on farmers.
A brave new era in European agriculture and agribusiness will begin in Killarney and West Cork today when the first Informal Council of Ministers in the enlarged EU begins.
It will be an auspicious occasion as the Farm Council’s Irish president, Agriculture and Food Minister Joe Walsh, welcomes his colleagues from 24 other member states for the two-day gathering, as well as ministers from Romania, Bulgaria and Turkey and three EU Commissioners.
Among them will be the farm ministers from the ten countries that joined the EU on May 1 to create the world’s largest trading block of around 455 million consumers, with Bulgaria and Romania due to join in 2007 with a further 31 million people.
The latest enlargement has brought an additional 75 million consumers and 4 million farmers into the EU, now bracing itself for exciting opportunities and daunting challenges. There will be new market opportunities but there will also be increased competition.
How the EU manages these and other issues will impact in particular on the lives of Europe’s 11 million farmers and its food processing sector, which includes 30,000 agricultural co-ops, with almost 9 million members, over 600,000 employees and €210 billion turnover.
Agriculture has always been important in the EU, which spends nearly half of its entire annual budget on various measures to support the farm sector. But in the new member states farming is far more important economically, providing on average five times as many jobs as it does in the EU-15.
The accession of countries with expansive poor rural areas and small farms has already raised concerns about how to adapt the Common Agricultural Policy (CAP) to the conditions of an enlarged Europe.
Direct farm payments in the new member states, where shedding the legacy of Soviet collectivisation remains a problem in many rural areas, will be phased in over ten years.
At the same time, European agricultural policy has come under concerted attack at world trade talks from developing countries who want an end to subsidies which they say condemn millions of their farmers to poverty.
Brussels rejects the claim and insists it has carried out fundamental reform of the CAP to make it much less trade distorting, more competitive and more in tune with the environment. It has also opened up its markets to developing countries.
Accepting that future agricultural policy has to seek greater riches from fewer pennies, European leaders have set tight budgetary allocations for the CAP until 2013 for the enlarged Union. Overall agricultural expenditure in the EU-27 (Bulgaria and Romania included) will rise from €54.3 billion in 2006 to €55.5 billion in 2013.
The share of agricultural expenditure in 2006 accounts for 45% of total commitments under the EU budget, but in 2013 this percentage, with Bulgaria and Romania added, will have decreased to 35%.
COPA and COGECA, the respective umbrella bodies for European farmers and agricultural co-operatives, are insisting that EU governments must ensure there are adequate funds made available over the next decade to finance the decisions they themselves have taken concerning agricultural reform and enlargement.
Peter Gaemelke (COPA) and Eduardo Baamonde (Cogeca) said that nowadays, in addition to the pressure to open up markets, society in Europe is placing increasing demands on farmers.
They are expected to meet higher standards of food and environmental safety, to lead the way in animal welfare and to widen their role to encompass land management for the benefit of the rural and urban dwellers as well as wildlife and fauna.
But, if farmers are to meet these expectations, policy must ensure that imported products comply with the same standards as EU production, and the EU must provide adequate support, they said.
The EU, which is implementing the most radical reform of the CAP since it was developed fifty years ago, believes the budgetary provisions are realistic.
Farm Commissioner Dr Franz Fischler said CAP reform has not only given farmers planning security for the future, it has also underlined the value of rural areas, and it has secured sustainability and market orientation by linking support to quality rather than quantity. It has also reinforced support for rural development.
Dr Fischler said the purchasing power of the additional 75 million consumers in the enlarged Europe would grow, experts predict, at twice the rate of those in the EU-15.
The demand for products with ‘added value’ will increase.
He accepted that many farmers in the EU-15 feel threatened by enlargement.
“Quality in particular is one issue on which the accession countries are lagging behind, and it is the one issue which our consumers have said time and again that they are not prepared to compromise on.
“For the time being, therefore, it is mainly the farmers and food industry in the EU-15 that will be able to capitalise on the market openings, whilst those in the new member states will have the competitive edge in terms of lower-cost feed grain and renewable raw materials,” he said.
