Fischer Boel outlines EU CAP reform priorities

Related tags Fischer boel European union Eu

Mariann Fischer Boel, the EU's recently appointed agriculture
commissioner, has claimed that sweeping EU agricultural reforms
will provide UK farmers with a "better balance of support",
while forging a more competitive and sustainable European
agriculture industry, Tom Armitage reports.

Speaking at the National Farmers' Union (NFU) annual conference in Birmingham, England earlier this week, Fischer Boel said that the EU's agri-food industry had to embrace the imminent CAP reforms, in order to "free itself from production-specific constraints."

In 2003 Fischer Boel's predecessor, Franz Fischler, introduced far-reaching reforms to the EU's Common Agricultural Policy (CAP), in an attempt to resolve the recurring problematic issue of food surpluses and also to ensure that its annual €90 billion subsidies were distributed only to farmers deemed worthy of receiving financial support.

Consequently, he proposed a so-called decoupling system, whereby single farm payments are paid to farmers under the Single Payment Scheme (SPS), irrespective of production and quota constraints - a legacy Fischler Boel is determined to see through.

"We all know that this reform is the only way forward for the CAP. De-coupling is an opportunity to become much more market orientated and cross-compliance actually ensures that this is done within a framework that provides the general public with the services and standards that are expected from farmers and which justifies the single payment,"​ she said.

Speaking for the first time in front of a major UK agricultural audience since assuming her new EU post, Fischer Boel also took the opportunity to discuss reform proposals for the EU's sugar regime, which for many years has proved a contentious issue among the EU's global trading partners and regional trade associations.

The World Trade Organisation (WTO) in 2003, for instance, mounted a legal bid against the EU, alleging that its current sugar production regime is both inflationary and protectionist (internal prices currently operate at approximately three times that of average world prices).

"We will do our sugar industry no favours if we fail to adopt a reform,"​ she warned, adding that in order to implement the necessary reforms the EU must first overhaul its current production regime by slashing quotas by around 16 per cent, followed by "a radical narrowing of the gap between EU and world sugar prices"​.

The EU's suggested quota reduction would lower guaranteed prices for white sugar from €632 per metric tonne over three years to approximately €421 - although Fischer Boel, stressed that any reforms made to the EU's sugar industry would not have a short-term effect on prices.

The agriculture commissioner and former Danish agriculture minister has previously underlined her intention to resolve the sugar quota issue, as it could potentially diminish the EU's leverage on other global agricultural issues at the WTO's trade talks scheduled for Hong Kong later this year.

Furthermore, a quick resolution is needed as the EU's current sugar regime expires on 1 July 2006 - leaving the sugar industry without quotas and subsidisation.

Despite already agreeing in principle to the EU's reform proposals, the UK's National Farmers' Union (NFU) yesterday expressed concerns that slashing the UK's sugar quota would not do its domestic industry any favours.

"The NFU recognises that reform is necessary to ensure a sustainable European sugar industry in the long term - the UK sugar industry, however, is one of the most efficient in the EU and only produces 50 per cent of domestic consumption, importing the rest from poor African, Caribbean and Pacific (ACP) countries. The current quota reduction method should be targeted at countries which produce an exportable surplus."

NFU president Tim Bennett also urged the EU to give the UK's 7,000 sugar beet growers more time to make the necessary reforms in future to avoid "uncertainty, undermining confidence and preventing future investment"​.

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