The CAP mid-term review is affected by the US Farm Bill

At the EU Agricultural Council meeting of May 27th 2002 the French delegation questioned what the likely effects of the US Farm Bill would be on world market prices and how far it would be compatible with the multilateral undertakings of the USA. Commissioner Fischler responded by stressing the importance of undertaking a full assessment and indicated that the forthcoming annual review of the prospects for agricultural markets would seek to factor in the effect of the Bill in its projects for the next six years. In view of the importance of this issue, the Commissioner indicated that the Council's discussions of the CAP mid-term review would be rescheduled for July 10th which would allow the implications of the Bill to be fully taken into account. On the broader question of the review the French delegation argued that it should not call into question the principles and mechanisms agreed on at the 1999 Berlin Summit, although the approach in certain sectors will need to be adapted to take account of the international environment. Comment: The US Farm Bill has already had an influence on the EU's position on the market access offer to ACP countries in the context of the forthcoming ACP-EU trade negotiations. The Commission's initial draft negotiating instructions proposed to 'grant duty-free access to its markets to all products originating in the ACP countries, as from entry into force of EPAs.' However, the Commission's final draft mandate was less forthcoming, restricting the Commission's commitments on market access to an assertion that: 'the Community should further improve current access to its markets for products originating in the ACP countries'. This in many respects reflects DG Agriculture's concern that the US Farm Bill will depress world market prices for major products subject to reform, and undermine the EU's efforts to close the gap between EU and world market prices. Should EU prices remain above world market prices it would be more difficult for the EU to remove import restrictions, since it is feared this could suck in imports and undermine the functioning of the EU markets concerned.At the EU Agricultural Council meeting of May 27th 2002 the French delegation..