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Redesigning the Common Agriculture Policy in a global environment

P(09)3589:1. Redesigning the Common Agriculture Policy in a global environment. Mark Cropper Economic Analyses and Evaluation Directorate DG for Agriculture and Rural Development European Commission. The anchorman – it’s all a question of co-operation. A global environment. 3.

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Redesigning the Common Agriculture Policy in a global environment

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  1. P(09)3589:1 Redesigning the Common Agriculture Policy in a global environment Mark CropperEconomic Analyses and Evaluation Directorate DG for Agriculture and Rural Development European Commission

  2. The anchorman – it’s all a question of co-operation

  3. A global environment 3

  4. A global environment Trade The EU has become the biggest raw material importer and biggest processed goods exporter The Doha Round remains a priority for the EU World economy Current reflections are taking place against the backdrop of volatile agricultural prices and economic downturn Climate change Awareness of its effects is growing It conditions much of our thinking in time and space 4

  5. The CAP: “Ceci n’est pas la PAC” 5

  6. This could be Van Gogh’s vision of the CAP 6

  7. Redesigning the CAP – back to the drawing board? Wishes – Sketches - Budget – Measuring up – Planning - Specifications 7

  8. The future of the CAP • The question “Where do we go from here?”… • … and the question “How did we get here?”… • …. cannot be fruitfully considered in isolation from one another Owen Barfield in « Romanticism comes of Age »

  9. EU-10 EU-12 EU-15 EU-25 EU-27 How did the CAP get to where it is?

  10. What events decide where we go from here? The EU Budget Review for post-2013 Public consultation in 2007-2008 Conference in November 2008 Communication on principles in 2009 Multi-annual financial framework proposals – July 2011 The June 2009 European Parliament elections The new Commission A new Treaty and Co-decision in agriculture? 10

  11. EU Budget Review: certain views expressed • EU main challenges • Competitiveness • Research/innovation • Environment/climate change • Energy supply security • CAP is good for some • Keep CAP financing • CAP is responding to challenges • CAP is more transparent • …and CAP is bad for others • CAP is not a priority • Direct payments are unfairly distributed • Merge Rural Development with cohesion policy

  12. Price support SPS Markets Direct payments Quotas XC/GAEC Axis 1 (structural adjustment) Axis 2 (environment) Rural development Axis 3 (territory and diversification) The CAP debate Income support Structural adjustment Public goods

  13. New safety net? Adjusted SPS Markets Direct payments Price support/ Quotas reform XC/GAEC Axis 1 (structural adjustment) Axis 2 (environment) Rural development Axis 3 (territory and diversification) Introduce revenue scheme ? Phase-out income support ? Income support Structural adjustment Public goods Phase-out ? What type of support ?

  14. Direct Payments – a few analytical elements Key word: heterogeneity 14

  15. The variation in farmer income support is criticised….

  16. … but payments per hectare are not much better « targeted »

  17. EU-wide flat rate shifts the distribution between MS…

  18. … without making the income support any “fairer” 168 000 Source: FADN

  19. The CAP debate: seeking the common ground Agriculture is still a strategic sector in Europe Diversity of the EU agriculture should be a key element Agricultural activities should be maintained in all regions Issues arising from the HC debate: Decoupled payments – the most efficient means Market-orientation is desirable - but safety nets are required Rural development objectives continue to apply beyond 2013 Modernisation Public goods Rural society and new societal challenges (climate change) 19

  20. Thank you for your attention

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