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EU unveils new plans to reform farm subsidies
calendar24-01-2003 | linkNULL | Share This Post:

BRUSSELS, Jan 22 (AFP) - The European Commission Wednesday unveiledrevised plans to reform subsidies to EU farmers, aiming to reconcilefierce disputes over funding the hugely expensive system.The EU executive said farmers had to become more business-like, but deniedit was abandoning them to market forces."Dear farmers, we are not going to abandon you. Nobody is going to abandonyou," Agriculture Commissioner Franz Fischler told a news conference.Rows over reforming the Common Agricultural Policy (CAP) have also becomemore heated as the 15-member bloc prepares to expand next year to take in10 mostly rural states.Europe's reluctance to phase out massive subsidies for farmers has alsosparked international criticism that the CAP gives Europe's agriculturalproduce an unfair advantage on world markets."This reform proposal is intended to provide farmers in both existing andfuture member states with the long-term stability they need," Fischlersaid."It is high time that our policy tools should be reformed so as to bestserve the interests not only of farmers, but also of consumers andtaxpayers," he said.The CAP swallows up nearly half the EU's current annual budget of 95billion euros (101.7 billion dollars), and has long been a subject ofbitter dispute.Farmers' champions, such as France, have complained the reform plan wouldharm EU agriculture, while other countries and groups have protested thatthe proposals are nowhere near radical enough.The new plan suggests that the link between farm subsidies and productionlevels should be severed, with funds progressively transferred to bonusesfor farmers for developing their land.The commission's revised proposals notably include a cut in subsidies formilk production and an increase in milk quotas for the planned 25 EUmember states by one percent annually in 2007 and 2008.Fischler however proposed delaying to 2007, from 2004, plans toprogressively reduce direct aid to farmers.But the core element of the reform remains the controversial idea of"decoupling" the link between the level of direct aid to farmers and theirproduction, and the introduction of a single payment independent ofproduction levels.Aides say Fischler hopes that the new CAP reform can be agreed by the endof the current Greek EU presidency in June, in order to be implementednext year.The EU executive was forced to review its initial proposals for CAPreform, presented last July, after EU leaders struck an accord in Octoberaimed at resolving long-running rows.French President Jacques Chirac, whose country is by far the biggestbeneficiary of EU farm aid, reached the deal with Chancellor GerhardSchroeder of Germany, the main EU paymaster.British Prime Minister Tony Blair was reportedly incensed by theFranco-German deal, which effectively put off real CAP reform for severalyears.The October deal did however agree to put an overall ceiling on farm aidfrom 2006, allaying fears of an explosion in the CAP budget after the EU'senlargement next year to countries including heavily agriculturalheavyweight Poland.Fischler said the new proposals would go some way to calming criticismfrom Europe's international partners that CAP subsidies run counter toWorld Trade Organization (WTO) rules."The Commission proposal would strengthen our negotiating handimmeasurably in the Doha Round" of world trade talks, launched in theQatari capital in November 2001 and due to last three years.