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Can the next CAP help to achieve Green Deal targets?

Whether the next CAP can help EU agriculture to meet the targets set out in the European Green Deal is one of several questions that need to be asked as the trilogue negotiators face into the ‘super trilogue’ on 25-26 May. I addressed this question in a talk given at a webinar organised by the Czech Association of Agricultural and Environmental Economists and Sociologists today. A copy of my presentation can be accessed here.

To address this question, my organising framework focused on four areas:

  • The robustness of the legislative framework itself
  • The ambition in Member State implementation in their national Strategic Plans
  • The rigor of the governance and oversight arrangements and the role of the Commission
  • Political economy obstacles through potential negative impacts on farm incomes.
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The EU’s position in global agri-food trade

We have become used to the mantra that the EU is both the world’s largest agri-food exporter but also its largest agri-food importer. But this was before Brexit and the departure of the United Kingdom from the EU. The UK is a large net importer, so its departure implies (a) that the EU27 now becomes a larger exporter because exports to the UK are added to the extra-EU exports of the EU28, and (b) a smaller importer, because UK imports from the rest of the world no longer count as part of EU27 imports.

The two charts below show the revised situation after Brexit.… Read the rest

Making the transition from income support to a sustainable agriculture in the CAP

The CAP in recent decades has been largely an income support policy, particularly since the decoupling of direct payments after 2005. These CAP budget transfers together with national budget support either in the form of co-financing or as stand-alone payments account for over half of net farm income (for family farms, this is equivalent to family farm income). For specific enterprises and in individual countries, the contribution to farm income can be even higher.

In the first part of this post, I present the most recent data on the dependence of EU farm income on public transfers (see this post for data up to 2018 and a description of the various indicators that can be used to measure the dependence of farm income on public support).… Read the rest