2020 vision
Presenting his political guidelines for the next five years, European Commission President José Manuel Barroso said "agriculture will continue to have an important place in Europe's future development".
Reform of the CAP, due to be launched in the second half of 2010, will aim to "ensure food security, preserve the environment and cherish the countryside, but also face new challenges such as climate change while providing a fair standard of living for farmers," he said.
"But it needs to adapt," Barroso stressed, saying the next Commission will have to decide on "the future needs and role of agriculture and rural development in the EU's 2020 vision".
Speaking about fostering diversity, Barroso announced his readiness to approve giving member states the freedom to ban GM crops on their territories (EurActiv 03/03/09). "In an area like GMOs, for example, it should be possible to combine a Community authorisation system, based on science, with freedom for member states to decide whether or not they wish to cultivate GM crops on their territory," he argued, opening the door to national GMO bans.
Link with budget reform
Whatever the Commission's intentions, CAP reform will be strongly linked with discussions between the 27 member states regarding the EU's long-term budget structure for the period 2014-2021.
Previous negotiations over the EU's long-term budget, held in 2005 under the leadership of Tony Blair and the UK EU Presidency, led to a head-on confrontation between Britain and France over CAP spending and the abolition of the UK's rebate for its EU contributions (EurActiv 17/12/05).
In the end, the UK obtained minor reductions and a commitment from its partners to carry out a thorough review of all EU spending in 2008-09. Meanwhile, the UK rebate will be phased out gradually between now and the end of 2013.
But further demands from the UK are likely to resurface in the next negotiating round, especially if the Conservatives were come to power in elections due next year (EurActiv 28/08/09).
"The budget review will be high on our agenda as it could give indications on the scope of the CAP after 2013," said Jean-Luc Demarty, director-general of the European Commission's agriculture department, speaking about the challenges for 2009.
A general review is due to be launched in the autumn under the Swedish EU Presidency, with negotiations expected to conclude before 2014.
Focus on market instruments, export support and rural development
Once the future CAP's budget has been set, the debate is expected to focus on market instruments, export support and rural development, as well as on how to allocate the money between member states. The discussions will take place in the aftermath of a sudden rise in food prices in 2007 and 2008, and the prospect of greater agricultural price volatility in future (EurActiv 17/06/09).
Ironing out huge farm payment disparities between EU countries after 2013, a major concern for 'newer' member states, is one of the priorities of the debate. Average levels of EU direct farm payments vary widely: Greek farmers, for example, receive some €600 per hectare of arable land, whereas Latvia's farmers get under €100.
While EU farm ministers have underlined that any future direct payment scheme will need to be "fair and legitimate, effective, simple to implement, sufficiently flexible, and easy to justify and explain," the task will not be easy, as member states and individual regions vary significantly in terms of farm size and face different environmental challenges.
Whatever is proposed - perhaps even a single average level of payment across all EU member states - there will be significant winners and losers in comparison with the current situation.
Member states to pay for eco-services?
The Commission has stressed that while farm budgets are bound to decrease, a safety net to guarantee farmers' income is needed. Such a safety net must not, however, be too distortive, and the financial burden of income guarantees could be divided between the EU budget and those of the 27 member states themselves (EurActiv 01/07/09).
According to Jean-Luc Demarty, member states could contribute to farming incomes by rewarding farmers for delivering targeted public goods, such as biodiversity protection and the cultural landscape, but the concept of 'public goods in agriculture' needs to be properly defined first (EurActiv 03/06/09).
EU Agriculture Commissioner Mariann Fischer Boel has stressed that payments should be linked to the delivery of public goods to avoid excessive intensification of farming, which could have serious environmental, economic and social consequences.
Climate change adaptation and mitigation
The Commission has also proposed to review key EU sectoral policies by 2012 to determine the potential impacts and costs of climate change for different economic sectors. A working document on agriculture states that the farming sector will suffer in the long-term unless structural and technological changes are implemented by public authorities to complement adaptation measures by individual farms.
At the same time, the Commission said last week that European farmers must slash their greenhouse gas emissions by at least 20% by 2020, primarily by producing biomass and storing carbon in the soil (EurActiv 16/09/09, 09/06/06).
Competition from non-food products such as biofuels for energy is also expected to feature in the debate.
