Month: May 2021

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.

It seems that the trilogue negotiations will result in a serious regression from the Commission’s original proposals, although some aspects of the green architecture remain to be decided in the super trilogue so the final outcome is not yet known.… Read the rest

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. Although the latest trade data available in the WTO International Trade Statistics from which these data are drawn is 2019, when the UK was still an EU Member State, the data have been re-worked on an EU27 basis. Agri-food trade is defined as those products covered by the WTO Agreement on Agriculture and set out in an annex to that Agreement.… Read the rest

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). Despite the criticisms that using the CAP as a mechanism of farm income support is ineffective, inefficient and inequitable (see this analysis and this previous post), there has been little progress in developing a less subsidy-dependent agricultural sector.… Read the rest