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Reforming the EU's Common Agricultural Policy: Health Check, Budget Review, Doha Round

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  • Zahrnt, Valentin

Abstract

Policy-makers are quarrelling about the future of the Common Agricultural Policy (CAP). France intends to conclude a CAP reform during its 2008 EU Presidency before a thorough Budget Review is due in 2009 that will revise CAP spending. The Doha Round of WTO negotiations might necessitate further decisions on agricultural tariff cuts at any time. This Policy Brief provides recommendations for agricultural policy reform in the EU. It argues, first, that all measures that distort market prices and production should be abolished. This includes production quotas, land set-asides, storage aids, export refunds, output payments, and area payments. Second, the Single Farm Payment (SFP), which provides income support to farmers independently of their current production decisions, should be phased out because it does not serve any societal need. Third, targeted subsidies that reward farmers for providing socially valued services that are not remunerated on the market, such as maintaining scenic landscapes, should be adapted. Many of these subsidies should be provided at the national or local level without or with little EU co-financing.

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Bibliographic Info

Paper provided by European Centre for International Political Economy (ECIPE) in its series ECIPE Policy Briefs with number 47838.

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Date of creation: Oct 2008
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Handle: RePEc:ags:ecippb:47838

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Related research

Keywords: CAP; EU; multifunctionality; subsidies; Agricultural and Food Policy; Food Security and Poverty; Political Economy;

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  1. Jean-Christophe Bureau & S├ębastien Jean & Alan Matthews, 2005. "The Consequences of Agricultural Trade Liberalization for Developing Countries: Distinguishing Between Genuine Benefits and False Hopes," Working Papers 2005-13, CEPII research center.
  2. Bureau, Jean-Christophe & Jean, Sebastien & Matthews, Alan, 2006. "The Consequences of Agricultural Trade Liberalization for Developing Countries," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25471, International Association of Agricultural Economists.
  3. Kym Anderson & Ernesto Valenzuela, 2007. "Do Global Trade Distortions Still Harm Developing Country Farmers?," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 143(1), pages 108-139, April.
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