The analysis of proposals of the Common Agricultural Policy reform and its impacts for the EU

The Common Agricultural Policy (CAP) is of the character of a highly protective policy of the EU Member States. It includes a number of measures distorting the market directly and influences the farmers' incomes depending on their production. There have been two reforms of the CAP so far and the third one is prepared with intention to come into force from 2006; it is called Mid-Term Review (MTR). This reform is concentrated on keeping and increasing consumers' credibility and shifting to more competitive agriculture more orientated on market needs. The main Reform proposals include horizontal issues, i.e. Decoupling, Modulation/Degressivity, Cross-compliance, Farm Advisory System, IASC, Rural Development, and market issues concern dairy, cereals, rye, durum wheat, dried fodder, potato starch, seeds, nuts, rice, set-aside, carbon credit, beef. Besides the above mentioned goals, it is necessary to ensure conditions for rural development together with demands on environmental protection and improvement, so-called second pillar of the CAP. The attempt of cross-sectional summary and analysis of the MTR impacts for the EU was made in the article based on results of six studies performed by universities and DG AGRI in Brussels.