Views on the CAP mid-term review proposals

According to reports in the Wall Street Journal the proposals contained in the mid-term review would benefit the world economy, especially poor farmers in the developing world who can not compete with subsidised farmers in rich countries. According to Duncan Green, a policy advisor, with the Catholic Agency for Overseas Development 'It should lead to less dumping of artificially cheap products on third-world markets'. This contrasts with the likely impact of the US Farm Bill, which through increased price support encourages production regardless of world demand. Internally the Commission proposals are caught between member states which fear an accelerated process of reform and those which want to see budgetary savings before enlargement in 2004. The French prime minister in particular has come out firmly against the mid-term review proposals, while the German agriculture minister, Renate Kuenast, has welcomed the proposals, provided that jobs and the environment can be protected. The German opposition leader Edmund Stoiber, however, has declared his opposition to the mid-term review proposals. At the time of the presentation of the reform proposals several hundred Spanish farmers protested in Brussels, claiming that they amounted to a serious attack on Spanish farming interests. French farmers meanwhile claimed that the proposals would decimate their industry, arguing that a 3% reduction in direct aid payments would mean that 200,000 farmers (almost half of French farmers) would leave the industry within 10 years. Socialist, Liberal and Green spokespersons in the European Parliament, however, broadly backed the proposals while the conservatives only expressed limited objections. Commissioner Fischler was not particularly concerned with the opposition expressed, indicating that this was simply the beginning of the negotiating process which would be a necessary part of moving reform forward. Outside of the EU, speaking in Geneva on July 15th 2002, the US deputy trade representative, Peter Allgeier, called the mid-term review proposals a 'step in the right direction'. Comment: A key determinant of the progress of the Commission's reform proposals is the outcome of the German elections. A victory for the opposition CDU/CSU would have created a Franco-German axis opposed to the proposals for reform, but the SPD victory requires France to reach some accommodation with the pro-reform group in the Council. Estimates of the likely employment implications of the reform proposals need to be carefully assessed in the context of the assumptions made and the factors which have been taken into account in making the calculations.According to reports in the Wall Street Journal..