EU agricultural production no more a self-sufficiency anchor

The last deal to reform the European Union’s Common Agricultural Policy (CAP) this week between the Parliament, the Commission and the Council is a final recognition, concluded that European agriculture is not considered any more as the basic supplier of food for the Union’s 500 million inhabitants. It also recognises that farmers should receive aid not for producing but rather for not sowing anything. Those facts were obvious even at the time of the previous CAP reform, when subsidies were disconnected from production volumes and were accorded to producers on personal account. With that farm aid scheme, applied during the past five years, payments were based on historical production data. This week’s reform completely disconnects aid from production and substantially reduces agricultural subsidies. It also introduces a ‘small farmers scheme’, under which producers with less than 3 hectares can choose to receive an annual subsidy of €500 to €1000 without any other obligation. It should be noted that almost one third of EU farmers belong to this category and complement their incomes by working in construction, tourism and other local activities. No farmers needed In short this new arrangement is a small hand-out to old farmers to support them until their physical death. Not to forget that the percentage of farmers in total populations is around 1% to 3% in the core European countries like Germany, Austria, Belgium, the Netherlands, Britain even France. The steeply falling political weight of farmers, together with their diminishing numbers, is mirrored in the innumerable successive reforms of the EU agricultural sector. In the 1970s and the 1980s when the vote of farmers was quite significant, mainly in France and Italy, agriculture was the most important policy of the then much smaller and closed EU club. It absorbed around 60% of the Union’s budget and the CAP was the only really common EU policy, enforcing identical laws in all member states. This last characteristic hasn’t changed much. Coming back to this week’s CAP reform, the agreement of the Parliament was hinged on rather unimportant details not touching on main policy lines. It treated agriculture as an environmental issue and farmers something like guardians of the land. Of course this is not the case in special subsectors like livestock and wine production, which still play an important economic role in core EU countries like France, Germany, the Netherlands, Italy and Spain. Still, even in those sectors the policy lines are not designed along the needs of the farmers but confront the sector as a regular business activity closely related to industry and commerce. Better import it It’s very characteristic of the general European Parliament attitude relating to this last CAP reform, that the most important amendment included in the relevant Press release, referred to the remote EU regions. It reads as follows, “For Parliament, the key issue in this final negotiating phase was to ensure that policy content which should be legislated under co-decision is not determined solely by heads of state. For example, negotiators saw it as essential that the Council accept Parliament’s demand to increase the rural development co-financing rate (i.e. the EU contribution) for less-developed regions, outermost regions and smaller Aegean islands to 85%”. It’s obvious that agriculture is not considered any more as the security anchor of EU’s food supply source. Tariff free imports of agricultural raw materials have substituted European agricultural production as the basis of the food processing industry. By the same token, farming populations are under extinction and some will be regarded as a left over from the old times.