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Agricultural cooperation in the context of the European Union Common Agricultural policy. Vladimirs Plahovs European Commission DG Agriculture and Rural development Direction F : Rural development programmes Unit F .2. CAP today Cooperation in the context of CAP Future developments.
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Agricultural cooperation in the context of the European Union CommonAgricultural policy Vladimirs Plahovs European Commission DG Agriculture and Rural development Direction F: Rural development programmes Unit F.2
CAP today Cooperation in the context of CAP Future developments Outline
Productivity Crises years Agenda 2000/ Reform 2003/ 2007-13 Post 2013 Health Check/Recovery Package 2008/2009 Beginning of the CAP 1992 Reform Food security Increase productivity Stabilize markets Support incomes Deepening of reforms: Market orientation, decoupling,consumer expectations Integrated RD Environment Simplification • 5 new • challenges: • Climate change • Biodiversity • Water • Ren. energies • Dairy • Broadband Reduce surpluses Environment Income stabilisation Budget stabilisation Excess supply Explosion of expendit. Internat. conflicts ??? 1. Evolution of key challenges and policy responses of the CAP-historic overview Competitiveness Sustainability New challenges
The CAP today A substantially reformed policy… … better performing… • Structured in two complementary pillars • Farm support mainly decoupled and subject to cross-compliance • Role of market intervention mechanisms significantly reduced to safety net level • Rural development policy strengthened with funds and new policy instruments • Surpluses belong to the past • Competitiveness improved • Improved transfer efficiency • More sustainable farming • Integrated approach for rural areas • Contribution to EU budget stability … and resulting in a territorial and environmentally balanced EU agriculture
Alternative views on the cost of the CAP CAP cost in 2009 (in absolute terms) CAP cost in 2009 (in relative terms) 41% of EU budget 0.5% of EU GDP Source: European Commission - DG Agriculture and Rural Development
CMO Rural Development Cooperation and the CAP
Fruit and Vegetable Olive oil Tobacco CMO
Legal framework Strategic approach Role of cooperation Rural Development
COUNCIL REGULATION (EC) No1698/2005 of 20 September 2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) STRATEGIC GUIDELINES COUNCIL DECISION of 20 February 2006 on Community strategic guidelines for rural development (programming period 2007 to 2013) (2006/144/EC) COMMISSION REGULATION (EC) No 1974/2006 of 15 December 2006 laying down detailed rules for the application of Council Regulation (EC) No 1698/2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) Legal framework
Key elements 1. EU Strategic Guidelines establish the Community Priorities for the period 2007-2013 A strategic approach 2. National Strategies reflect EU-priorities according to the situation in the Member State concerned 3. Establishment of national or regional programmes on the basis of SWOT analysis 4. Programme implementation accompanied by monitoring und evaluation („ongoing evaluation ') based on a Community framework
Rural development policy 2007-2013:Measures « LEADER Axis » (min. 5%): integrated, bottom/up, innovative Axis 3: Diversification and quality of life (min.10%): Axis 2: Environmentand Land Management (min.25%): Axis 1: Competitiveness (min. 10%): • Farm modernisation • Processing • Infrastructure • Natural disaster aid • Training • Less favoured areas • Natura 2000 • - Agri-environment • - Forestry measures - Diversification, tourism - Micro-enterprises - Village renewal - Basic services EAFRD: European Agricultural Fundfor Rural Development 7
HC confirmed initial balancebetween axes Indicative EAFRD Financial plans per axis (with Health Check and Recovery Package)
Total indicative RD expenditures for EU-27 (2007-2013) with Health Check and Recovery Package • EAFRD: € 96.2 billion* 41.6% • National co-financing: € 57.2 billion** 24.7% • Private expenditures: € 65.5 billion** 28.3% • National ‘top-ups’: € 12.4 billion** 5.4% • TOTAL: € 231.3 billion 100.0% * This figure includes the additional amounts from Health Check and Recovery Package ** These figures are based on the revised programmes approved end of February 2010.
Policy perspective Instruments Cooperation
Council Regulation Strategic Guidelines Policy perspective
competitiveness of the agricultural and forestry sectors – The core objective increased competition market opportunities innovative approaches in developing new products, processes and technologies Encouragement of cooperation between farmers, the food and the raw materials processing industry and other parties Council Regulation
priorities of knowledge transfer, modernisation, innovation and quality in the food chain, and investment in physical and human capital. restructuring and modernisation of the agriculture sector. improving integration in the agrifood chain facilitating innovation and access to research and development (R &D). Strategic Guidelines
Investments measures aimed at restructuring and developing physical potential and promoting innovation Specific measures targeting cooperation Instruments
Common Agricultural Policy (CAP) Post 2013 - Context
2. Setting the context: Institutional context The institutional context of the CAP debate • Lisbon Treaty: Co-decision • WTO prospects • New financial perspective
Smart growth - an economy based on knowledge and innovation: R&D and innovation Education, training and lifelong learning Digital society Sustainable growth - promoting a more resource efficient, greener and more competitive economy: Competitiveness Combating climate change Clean and efficient energy Inclusive growth - a high-employment economy delivering economic, social and territorial cohesion: Employment Skills Fighting poverty 2. Setting the context: the EU2020 strategy EUROPE 2020 interlinked priorities:
2. Setting the context: specific key challenges Global markets, on-going restructuring, price/production volatility Increasing scarcity of natural resources (e.g. land, water, biodiversity) Climate change Impact of economic crisis on rural areas Demographic change and diverging development of rural areas in EU 27 Wider development of rural areas
“The CAP towards 2020: meeting the food, natural resources and territorial challenges of the future” Communication on the future of the CAP
What are the objectives of the reform? Sustainable management of natural resources and climate action Balanced territorial development Viable food production • To guarantee the provision of public goods • To foster green growth through innovation • To pursue climate change mitigation and adaptation • To contribute to farm income and limit its variability • To improve sector competitiveness and share in food chain value-added • To compensate areas with natural constraints • To support rural vitality and employment • To promote diversification • To allow social and structural diversity in rural areas Common EU response needed
What policy instruments? Based on two pillar structure Better targeted to objectives Direct payments Market measures Rural development • Redistribution • Better targeting • Redesign: • Greening of direct payments • Capping of payments • Small farmers support • Areas with specific natural constraints • Market orientation • Streamline and simplification • Improved food chain functioning • Environment, climate change and innovation as guideline themes • Improved coherence with other EU policies • More effective delivery mechanisms • Address risk management • New distribution criteria
Price transmission along the food supply chain FOOD PRICE CRISIS PRODUCERS’ LAG RETAILERS’ LAG STABILISATION Food producer prices Agricultural commodity prices Food consumer prices Overall inflation (HICP) Source: European Commission – DG Economic and Financial Affairs, based on Eurostat data
What policy options? • More equitable distribution among MS and among farmers • Greening of direct payments • Capping of payments • Increase small farmers support Direct payments • More equitable distribution among MS and among farmers • Gradually phase out direct payments Market measures • Streamline and simplify existing measures • Streamline and simplify existing measures • Phase-out most measures • Keep disturbance clause for severe crises • More focus on environment, restructuring and innovation, climate change, local initiatives • Risk management tools and income stabilisation tool • New distribution criteria • Continue emphasis on climate change, biodiversity, bio energy and innovation • Primarily focus on measures linked to the environment and the delivery of public goods Rural development Option 1 Option 3 Option 2
Roadmap for the EU‘s policy post 2013 2013 (n-1) 2012 (n-2) 2011 (n-3) 2014 (n) 2010 (n-4) • Public Consultation • Prepare policy proposal &impact assessment • Communi-cation on CAP post 2013 • Submit IA • Launch ISC • Publish legal proposal • Start negotiations with EP and Council • Continue negotiations with EP and Council on legal proposal • Draftingof strategy/ programmes Implementation of the Policy 16
More information on Rural Development and the CAP: The CAP after 2013 http://ec.europa.eu/agriculture/cap-post-2013/index_en.htm The Communication on the future of the CAP http://ec.europa.eu/agriculture/cap-post-2013/communication/ index_en.htm Public consultation http://ec.europa.eu/agriculture/cap-post-2013/consultation/ index_en.htm EU agriculture and CAP reform http://ec.europa.eu/agriculture/index_en.htm EU Rural Development policy 2007-2013http://ec.europa.eu/agriculture/rurdev/index_en.htm Agricultural Policy Analysis and Perspectives http://ec.europa.eu/agriculture/analysis/perspec/index_en.htm 29