The EU agricultural budget for 2004

Total EU-15 agricultural expenditures for 2004 (market support, direct aid, and rural development) are set to rise to €45,797 billion from €44,782 billion in 2003. The first agricultural budget for the EU-25 will be in 2004 and will total €47,885 billion. Expenditures on rural development are set at €4,803 billion for the EU-15 and €6,536 billion for the EU 25. A briefing by the US Department of Agriculture on the EU 2004 budget notes that the US$/€ exchange rate is having a profound effect on EU export-refund expenditures, with export refunds on arable crops rising from €104 million in 2003 to €532 million in 2004. Significantly, the outcome of CAP reform is expected to have minimal impact on the 2004 budget, since the reforms will only be felt from 2005 onwards. Comment: The USDA review of the EU 2004 agricultural budget highlights a 33% increase in EU expenditures on food safety. It should be noted that many food-safety measures were formerly categorised under the sectoral budget of the sector concerned. Their removal into a separate budgetary category removes them from the EU's self-imposed ceiling on CAP expenditures. Similarly it should be noted that rural-development expenditures have been removed from the formal calculation of the expenditures to which the new EU budgetary ceiling applies. It should also be noted that the EU contribution to rural-development programmes constitutes only around 50% of the total financing made available to such programmes, with member governments, and occasionally private-sector associations, providing the remainder. This highlights the extent to which the EU will be expanding agricultural support in those areas not subject to ceilings.Total EU-15 agricultural expenditures for 2004 (market support,..