The French government has launched a new website as part of the run-up to a conference it will hold on 3 July, at the very beginning of France’s 6-month EU Presidency, to discuss the future of European and global agriculture. Entitled “Qui va nourrir le monde?” (Who will feed the world), the debate is being organised around six questions, divided into two groups. Find out more after the jump…
Group one: Agriculture as a driver of growth and development
1. What are the prospects for local production in a global marketplace?
2. Can family farms provide jobs for young people?
3. How can agriculture contribute to the protection of the environment?
Group two: Regional and global governance
4. What are the challenges in North-South relations, what new forms of agriculture partnerships?
5. What are the roles for producer organisations in managing markets?
6. What international regulation is needed to balance the interests of the world’s farmers?
The website is in French only at the moment, for non-French speakers, Google’s sometimes haphazard machine translated version might be useful.
As well as launching websites, Michel Barnier, the French agriculture Minister, has been leading a media offensive over the past few weeks in advance of the French EU Presidency, and has been offering some answers to his questions. His interview with the Financial Times makes interesting reading, as does the FT’s firm riposte on its leader page. We can safely ignore Barnier’s views about Africa needing its own CAP. Such madness ought to be considered an extreme outlier position, at the opposite end of the ideological spectrum from the UK Government’s tactically naive vision paper of December 2005.
More interesting is Barnier’s idea that EU food quality and safety standards will be “the new policy of European preference”. Remember, President Sarkozy has spoken in vague terms in favour of Community Preference, aka ‘Fortress Europe’. Maybe now we are beginning to see the details. This approach has long been suspected as a way of squaring the circle of making EU agriculture globally competitive while keeping standards high. Simply use high EU standards as a way of keeping out competition while continuing to export high value European wine, spirits, processed meats and cheeses. The concept is particularly relevant for the EU’s trading partners. More advanced developing countries like Thailand and Brazil generally have few problems meeting new EU standards. Indeed many of the livestock operations in these countries are actually run by European companies, or with significant EU investment. However, earlier this year we did see the Irish farm lobby successfully lobby for a ban on Brazilian beef on the grounds that Brazil doesn’t meet EU traceability rules (nothing to do with Brazil being Ireland’s main competitor in the bottom end of the beef market, naturally). Where this ‘new policy of European preference’ will really hurt is in the least developed countries, especially in Africa. These countries lack the infrastructure and systems to comply with every last letter of EU traceability and food production rules, although a substantial boost in investment might help them catch up. Everything But Arms has removed the tariffs, but have they been replaced by a new wall of non-tariff barriers?
The non-tariff barrier approach is not entirely new. Long-running disputes over poultry and beef with the US are motivated – at least in part – by a desire to protect domestic producers from competition. The EU has long sought to get its Geographic Indications accepted into the WTO as a form of intellectual property with worldwide legal protection. With tariffs set to tumble if the DDA is concluded, there are no doubt those who feel that ‘Community Preference 2.0’ is the way forward.
Meantime, a report in the FT last week hints that Germany and France are looking towards making a long-term deal to protect the CAP budget beyond 2013. At a meeting in Brussels last week, a senior official from the German agriculture ministry treated the audience to a spirited defense of the CAP. The official argued that the CAP was doing a great job and that it would be rash to tamper with it. The Schroder-Chirac deal on CAP spending killed off any hope of substantial reform of the CAP before 2013. That deal was ostensibly made to allow for EU enlargement (and in the process swindle the ten new member states by giving them very small shares of CAP direct payments). Now the suspicion is, as one seasoned Brussels hand aptly puts it,
“France will help Germany in killing higher EU emission standards for cars and Germany will help France kill CAP reform. Peace and harmony across the continent.”
These kinds of back-room deals are always murky, and this one appears especially unsavory. Franco-German stitch-ups might have been the way things worked in the EU of 10 or 15. Today’s EU of 27 should not stand for them.
There is no doubt that the ‘food crisis’ is putting wind into the sails of those who would like return the CAP to its productionist roots: paying farmers public money to produce more food. Environmentalists, arguably the single most powerful group within the very loose CAP reform coalition of the past few years, are suddenly on the back foot. An early example is the abandonment of compulsory set-aside without any real flanking policies to secure the environmental benefits that are a by-product of leaving land fallow. Development advocates, another important group within the CAP reform coalition, are in a pickle because their longstanding critique of EU export dumping no longer make so much sense when the problem is suddenly that world food prices are too high, not that they are too low.
The solution to what is best described as a ‘food affordability crisis’ is not more subsidy-driven intensification of European agriculture. With water supplies and ecosystems critical to agriculture (e.g. pollinating insects) already under strain, the CAP should prioritise the long-term conservation of European natural resources. As Ariel Brunner of BirdLife International argues, it’s not our ability to produce enough food now that’s the problem, it’s our ability to produce enough food in several decades time, with climate change and population growth putting ever greater strain on the land. In the context of the current crisis, the very short term the solution is a big increase in funding for the World Food Programme. The heart of the problem is that poorer developing countries have agricultural systems that have barely made it into the 19th century, let alone the 21st century. And farm protectionism practiced by the EU, the US and Japan shares a part of the responsibility for this. Raising farm productivity in sub-Saharan Africa must be the priority, but this takes time. What is needed is investment in irrigation, transportation and credit to allow the purchase of the basics: seeds, machines and fertilizers. Reducing barriers to trade between developing countries is also important, although many countries suffering the pinch of high food prices are dropping their tariffs like hot potatoes. If this is what Barnier means when he talks about a CAP for Africa, then all well and good, but I suspect he is really advocating a disastrous policy aim of regional self-sufficiency and new barriers to trade.
A sustained period of higher food prices will provide a market incentive for this investment. Public policy can help prime the pump, and ensure that the transition from a low price/low productivity/low output agriculture to a low price/high productivity/high output agriculture is made as rapidly as possible, with as little time spent in the transitional high price/low productivity/low output phase. In the meantime, any subsidies aimed at averting hunger should focus on increasing the buying power of the urban and landless poor and not suppressing prices by legislation or export controls.
To come back to the French government’s question, the world can feed itself, but we need to work together and keep trading together.