Author: Alan Matthews

Alan Matthews is Professor Emeritus of European Agricultural Policy in the Department of Economics at Trinity College, Dublin, Ireland. His major research interests are agricultural policy analysis, the impact of international trade on developing countries, and computable general equilibrium analysis of trade and agricultural policy reforms. He has worked as a consultant to the European Parliament, the OECD, the Food and Agricultural Organisation of the United Nations and the UN Industrial Development Organisation, and has been a panel member in a number of WTO Dispute Settlement procedures. He is a former President of the European Association of Agricultural Economists but writes here in a personal capacity.
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Environment Ministers fail to endorse Commission’s greening proposals

The refusal of the Environment Council meeting on 19 December last to endorse the Commission’s greening proposals in its legislative proposals for CAP reform has been interpreted as a victory for agricultural interests attempting to water down the greening element in these proposals. But this interpretation may underestimate the extent to which there is genuine doubt about the effectiveness and environmental value of the measures that the Commission proposes.

The biodiversity challenge

The Environment Council was meeting to adopt conclusions on the EU biodiversity strategy to 2020. In March 2010, EU leaders recognised that the 2010 biodiversity target would not be met despite successes such as establishing Natura 2000, the world’s largest network of protected areas. They went on to endorse the 2050 long-term vision and the 2020 headline target proposed by the Commission in its Communication Options for an EU vision and target for biodiversity beyond 2010.

Subsequently, the Commission proposed its 2020 Biodiversity strategy in its Communication Our life insurance, our natural capital: an EU biodiversity strategy to 2020 which includes six mutually supportive and inter-dependent targets that respond to the objectives of the 2020 headline target.… Read the rest

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Environment Ministers fail to endorse Commission's greening proposals

The refusal of the Environment Council meeting on 19 December last to endorse the Commission’s greening proposals in its legislative proposals for CAP reform has been interpreted as a victory for agricultural interests attempting to water down the greening element in these proposals. But this interpretation may underestimate the extent to which there is genuine doubt about the effectiveness and environmental value of the measures that the Commission proposes.
The biodiversity challenge

The Environment Council was meeting to adopt conclusions on the EU biodiversity strategy to 2020. In March 2010, EU leaders recognised that the 2010 biodiversity target would not be met despite successes such as establishing Natura 2000, the world’s largest network of protected areas. They went on to endorse the 2050 long-term vision and the 2020 headline target proposed by the Commission in its Communication Options for an EU vision and target for biodiversity beyond 2010.
Subsequently, the Commission proposed its 2020 Biodiversity strategy in its Communication Our life insurance, our natural capital: an EU biodiversity strategy to 2020 which includes six mutually supportive and inter-dependent targets that respond to the objectives of the 2020 headline target.… Read the rest

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The challenge of moving to the regional model

The Commission’s legislative proposals for the CAP post 2013 contain two measures to harmonise direct payments per ha across farms: (i) a move to more uniform payments per hectare across member states, and (ii) a move to more uniform payments per hectare within member states by moving from the historical to the regional model of payments. While both measures are prompted by the desire to have a more uniform distribution of payments per hectare across EU farms, it is useful to keep the measures distinct. For that reason, it is helpful to talk about the convergence of payments across member states, and the flattening of payments within a member state.

The argument for flattening payments within a member state is that differences in the level of payments per hectare due to historical factors can no longer be justified, and that tying the value of entitlements to historical performance is unfair as between farmers themselves.… Read the rest

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CAP reform conference December 19th 2011

The Commission in co-operation with the Parliament is organising a conference ‘CAP reform through analytical lenses‘ to provide a forum for discussion on the CAP reform legislative proposals with researchers and scientists. The event will take place during the meeting of the European Parliament’s Committee on Agriculture and Rural development to be held in Brussels on Monday 19 December and will be web-streamed. The agenda for the meeting is here.

This post is written by Alan Matthews… Read the rest

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Agreeing the allocation of CAP funds between Member States

The great bulk of EU CAP expenditure (the Heading 2 ‘Preservation and management of natural resources’ in the 2007-2013 Multi-annual Financial Framework) is allocated to member states in the form of national ceilings under Pillar 1 and national breakdowns under Pillar 2. One of the reasons for the success of the Fischler and Health Check reforms was that they did not fundamentally alter the allocation of member state receipts.

Redistribution a central issue in CAP 2020 negotiations

The distribution of CAP funds between states is now a central issue in the CAP negotiations given the commitment to bring about greater convergence in the level of entitlement payments per hectare. There is certainly no logic in the current distribution which reflects the historical legacy of the origin of the payments as compensation for support price reductions for particular commodities, as well as the outcomes negotiated by the new member states over the size of their Pillar 1 and Pillar 2 envelopes as part of their treaties of accession.… Read the rest

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What Durban means for EU agriculture

Agriculture, uniquely, has a dual role in climate change discussions. It faces significant adaptation challenges as global temperatures rise and there is a greater frequency of extreme weather events. But it also has the potential to help mitigate climate change through reducing emissions and removing them through carbon sequestration.

In this post, I ask what the implications of the outcome of the Durban UNFCCC climate conference might be for EU farming and agricultural policy.

Agriculture and EU emission targets – where we stand

Agriculture is included in the accounting for the EU’s Kyoto Protocol emission reduction targets for the period 2008-2012 and in the Climate and Energy Package (CEP) 2020 target of a 20% reduction in global greenhouse gas emissions over the 1990 base year.

How farming might be affected by these targets is up to the individual member states to decide. There are no agriculture-specific targets at EU level. Agricultural emissions contribute just under 10% to total EU emissions, but what counts in measuring the potential contribution required from agriculture to the EU targets is its contribution to total non-ETS emissions.… Read the rest

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Launch of E-learning CAP course

For those interested in learning more about the EU’s Common Agricultural Policy, a new online learning course on the CAP has just been launched by Groupe de Bruges in association with Associazione Alessandro Bartola/Agriregionieuropa and SPERA (Interuniversity Center on Rural, Environmental, Economic Policies) led from the University of Ancona. The course consists of eight modules and participation is free [Disclaimer: I have contributed one of the modules on the CAP in an international context]. Each module consists of one or two powerpoint lessons lasting around 40 minutes, and there are short entry and exit tests to help students assess their knowledge. Financial support for the development of the course was provided by the European Commission and the Swiss Fondation Charles Léopold Mayer pour le Progrés de l’Homme.

Already in the first month around 200 people from 30 countries had registered to take the course. This thread is open for comments and feedback from anyone who has registered and participated in the course.… Read the rest

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Agricultural consequences of the eurozone crisis

The consequences of the decisions at the fateful Brussels summit on 9 December 2011 will take time to assess. Whether leaders did enough to calm the markets and allow eurozone governments to refinance their enormous debts next year at reasonable interest rates will be known relatively quickly. Many commentators feel that financial markets will not be impressed, and that the EU is facing into a prolonged depression in which the break-up of the eurozone is a real possibility.

The significance of the institutional changes implied by the creation of a new inner core of EU member states pledged to achieve greater fiscal integration will only be known over a longer time span. Whether Britain, by opposing a new treaty, has lost influence and will move towards the EU’s exit door is also still unclear.

EU agriculture and agricultural policy-making in the EU will not be immune to these momentous changes. Whether the CAP budget can be safeguarded in the negotiations for the next Multi-annual Financial Framework must be increasingly in doubt.… Read the rest

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New Commission study on impacts of Doha Round

The G20 Cannes Summit, despite being side-tracked by the continuing eurozone crisis, did address other issues of importance to the global economy. In the section of its final communiqué on trade, the heads of state reaffirmed their ritualistic commitment to the Doha Round mandate. However, they went on to note that “It is clear that we will not complete the [Doha Development Agenda] if we continue to conduct negotiations as we have in the past.” Instead, they called for “fresh, credible approaches to furthering negotiations, including the issues of concern for Least Developed Countries and, where they can bear fruit, the remaining elements of the DDA mandate” to be pursued in 2012.

However, as the preparations for the forthcoming WTO Ministerial Council on 15-17 December rachet up in Geneva, there is little evidence that the same countries are ready to reach agreement on a common approach to the next steps to rescue the Doha Round.… Read the rest

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Russian WTO accession by end year?

An announcement last week by Karel de Gucht, the EU Trade Commissioner, that the EU and Russia had struck a deal on remaining outstanding bilateral issues in negotiating Russia’s accession to WTO membership raises the prospect that this economic giant could become a WTO member by the end of this year.

Russia and the WTO

Russia first made its application in 1993 so has been negotiating its accession now for 18 years, by far the longest of any accession process by a WTO applicant. This reflects in part the country’s economic size (it is the sixth largest economy in the world on a PPP basis). Whereas normally 6-10 countries might seek to open bilateral negotiations with an acceding country because they had special trade interests at stake, in Russia’s case more than 60 countries made such requests.

But also China was a large economy whose WTO accession affected many countries, but despite the greater legacy of a command-and-control economy than in Russia’s case, China has now been a WTO member for a decade.… Read the rest