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More supply management demanded in COMAGRI single CMO report

The French EPP member Michel Dantin is the COMAGRI rapporteur for the Commission’s draft revisions of the single CMO regulation. His draft report is detailed and comprehensive – he alone has tabled 434 amendments to the Commission’s draft regulation. Many of these amendments implement the two guiding principles which animate his report, namely, distrust in the ability of markets to always work satisfactorily where agriculture is concerned, and the desire to emphasise the legislative role of the Parliament vis a vis both the Council and the Commission.
Mr Dantin is a believer in the theory of ‘agricultural exceptionalism’ and that farmers require state assistance to operate in dangerous markets.

The fact that agricultural markets are, as a result, becoming more volatile implies first of all that the CAP budget, especially where the Single CMO is concerned, has to continue on its present scale if it is to cope with the crises which can, at any moment, threaten Europe’s agricultural production potential and hence jeopardise the CAP’s prime aim, namely to ensure that Europeans can enjoy food security.

… Read the rest
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Danish Presidency CAP reform progress report

The Danish Presidency has submitted its report to the Agricultural Council on the progress achieved during the first half of 2012 on CAP reform. The report indicates the main amendments suggested by the Presidency to the Commission proposals and on which the Presidency has noted broad support from delegations. The overview report contains a list of working documents in the Annex prepared by the Commission which provide further explanations of its proposals.
In addition to the overview report which notes the positions taken in the Council on the various elements of the Commission’s proposals, the report is accompanied by a series of revised draft regulations which include the specific amendments proposed by the Presidency. The Presidency proposals for the four main revised regulations are as follows.
Proposal for a Regulation of the European Parliament and of the Council establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy (CAP Reform) – Presidency consolidated revised text
Proposal for a Regulation of the European Parliament and of the Council establishing a common organisation of the markets in agricultural products (Single CMO Regulation) (CAP Reform) – Presidency consolidated revised text
Proposal for a Regulation of the European Parliament and of the Council on support for rural development by the European Agricultural Fund for Rural development (EAFRD) – Presidency consolidated revised text
Proposal for a Regulation of the European Parliament and of the Council on the financing, management and monitoring of the common agricultural policy (the horizontal regulation) – Presidency consolidated revised text
An interesting parlour game for CAP watchers for the rest of the summer will be to compare the Presidency draft text for the four regulations with the COMAGRI rapporteurs’ draft texts which will be discussed in COMAGRI on 18-19 June.… Read the rest

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COMAGRI draft report on rural development

As noted in a previous post, the draft reports by the COMAGRI rapporteurs on the four main CAP regulations were published last week. They include the reports on the future of direct payments and support for rural development by Mr Luis Manuel Capoulas Santos, the report on the single common market organisation by Mr Michel Dantin, and the report on the common provisions for financing, management and monitoring of the CAP by Mr Giovanni La Via. This post summarises the main changes proposed in the Capoulas Santos draft report on support for rural development after 2013.
Investments in physical assets. The draft report advocates that the provision in the current regulation providing for support for complying with new Community standards in the fields of environmental protection, public health, animal and plant health, animal welfare and occupational safety should be maintained, but limited to support of specific investments undertaken by farmers.… Read the rest

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London Olympics opening ceremony chimes with greening vision for the CAP

The dazzling opening ceremony of the 2008 Beijing Olympics was a triumph of discipline, choreography, stagecraft. London will host the games later this summer and it was announced today that the 2012 opening ceremony will take an altogether different, gentler approach. The 2012 Olympics will open with a pastoral representation of the countryside comprising a mixed farm with over a hundred real live farm animals, a flower meadow, rivers, streams, cricket and thatched cottages. In short, the British countryside as it was before intensive agriculture and the common agricultural policy came along.
The organisers of the London Olympics seem very much in line with the European Commission’s thinking on the future of the CAP: agricultural intensification has gone too far, we need to start repairing the damage done to the countryside. Unfortunately, as Alan Matthews has described in some detail, the elected representatives of the European people are doing their best to scupper the Commission’s reform proposals.… Read the rest

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COMAGRI draft report on direct payments regulation

The draft reports by the COMAGRI rapporteurs on the four main CAP regulations were published last week. They include reports on the future of direct payments and support for rural development by Mr Luis Manuel Capoulas Santos, the report on the single common market organisation by Mr Michel Dantin, and the report on the common provisions for financing, management and monitoring of the CAP by Mr Giovanni La Via.
In addition, a number of the other EP committees have prepared draft opinions on the proposals – see the Environment Committee here, but also the Development Committee, the Budget Committee and the Regional Development Committee. The easiest way to keep track of these reports is by following the links on this European Parliament Legislative Observatory page to the individual procedure files.
The draft reports will be amended later, but they provide the first official indication of the thinking in the European Parliament on the Commission’s CAP post-2013 legislative proposals.… Read the rest

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How the EU market looks to food exporters

In a recent post I looked at estimates of the overall level of protection to EU agriculture and how they compare to other countries. However, the EU trade regime is highly discriminatory. Different countries face different tariff regimes depending on the nature of any trade agreements they have with the EU or the preferential trade regime from which they benefit.
The average applied tariffs calculated in the MAcMap global tariff database I discussed in the previous post take account of these preferential tariffs. However, the published report only presents the overall EU average tariff. In this post, I make use of data from the WTO World Tariff Profiles to examine differences in the market access tariff barriers faced by different groups of exporting countries to the EU.
Few countries face the standard Most Favoured Nation (MFN) tariffs. They are the developed countries (for example, US, Australia, New Zealand, Canada) with whom the EU has not negotiated a preferential trade regime.… Read the rest

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More thoughts on the European Innovation Partnership for Agriculture

One of the more widely-welcomed elements of the Commission’s legislative proposals for the CAP post 2013 was a greater emphasis on promoting innovation. In an earlier post in January, I discussed the three main components of this strategic emphasis, namely:
• Continued Pillar 2 support for investment in physical assets and farm extension services.
• A new European Innovation Partnership instrument for agricultural productivity and sustainability (EIP-A) also in the Rural Development Pillar.
• Increased funding amounting to €4.5 billion for agricultural and food research under the Commission’s Horizon 2020 research programme for research and innovation on food security, the bio-economy, and sustainable agriculture.
Since that previous post two developments of note have taken place. The Commission published its Communication on EIP-A in February. And this week science ministers gathered in the Competitiveness Council, after long and hard negotiations, gave their backing to a general structure for the Horizon 2020 research programme.… Read the rest

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Will the right tariff average stand up?

How heavily protected is EU agriculture by import tariffs? How does EU agricultural protection compare with other countries? To answer these apparently simple questions requires a huge amount of spadework, and we will see that there are different answers which can all lay claim to be ‘correct’. Fortunately, a joint team at the Centre d’Etudes Prospectives et d’ Informations Internationales (CEPII) in Paris and the International Trade Centre (ITC) in Geneva undertakes this necessary legwork and publishes their results every three years as the MAcMap-HS6 (Market Access Maps) global tariff database. MAcMap Version 3 covering tariff data for the year 2007 has just been published. It’s an impressive resource – the Version 2 database took up 8 GB of disk space! Hats off to the researchers involved, Houssein Guimbard, Sébastien Jean, Mondher Mimouni and Xavier Pichot.
A picture of global agricultural protection

A unique feature of MAcMap is to allow a meaningful average level of applied protection worldwide to be computed.… Read the rest

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Macroeconomic conditionality and rural development funding

The European Commission has proposed to extend the principle of macroeconomic conditionality which currently exists for the Cohesion Fund to all the ‘CSF’ funds in the next MFF period. The CSF funds are those covered by the Common Strategic Framework and include the EAFRD rural development fund as well as the regional, social, cohesion and fisheries funds. The basic idea is that commitments agreed for a member state under its Partnership Contract could be suspended if a member state is not compliant with its macroeconomic guidelines. As the Commission explains:

The draft Regulation seeks to establish a much closer linkage between EU cohesion policy and economic governance, on the grounds that sound economic policies are essential to ensure that CSF Funds are spent effectively. So, for example, the Commission may ask a Member State to amend its Partnership Contract to bring it into line with recommendations issued within the framework of the EU’s broad economic or employment guidelines or excessive deficit procedure, and may suspend CSF payments if a Member State fails to do so.

… Read the rest
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The political economy of eliminating sugar quotas in 2015

The Commission’s legislative proposals for the CAP after 2013 published in October 2011 include no proposal to continue the sugar production quota regime. An intense struggle is underway between EU sugar producers who want an extension to the quota regime and sugar users who support the Commission’s proposal. We review the political debate in this post.
Opponents of sugar quota elimination

The European Committee of Sugar Manufacturers (CEFS) (here and updated here) accepts that quotas will end in the long term, but supports the continuation of the quota system until 2020 rather than 2015. It argues that the EU sugar industry has actively engaged and invested to further improve its competitiveness and efficiency since the 2006 reform of the sugar CMO. It seeks an additional five years to enable the European sugar industry to continue this improvement process and to capitalise on long term infrastructure investments.
They highlight the stability of the strictly regulated EU market, arguing that there can only be losers from the volatility that a liberalised sugar market would entail.… Read the rest