05 March 1999
Germany gives ground on farm reform

GERMANY has bowed to French demands on financing of the Common Agricultural Policy (CAP).

French ministers claimed victory when German officials conceded they saw no point in continuing to press Paris to accept that the CAP should be “co-financed”.

Co-financing would see individual member states contributing a share of the billions of pounds paid annually by the European Union (EU) to their farmers.

Frances refusal to accept the German and British-backed scheme for the £30bn CAP was a central sticking point in the attempt to cut the cost of the CAP.

Reducing the cost of the CAP is vital to produce a new six-year budget package for the whole Union to allow the accession of central European countries.

The German climbdown clears the way for farm ministers as they began their latest attempts to revamp the CAP in Brussels last night.

Germany had tabled the co-financing scheme as the best way to achieve its goal of cutting its own £8bn net contribution to the EU budget.

But it infuriated France which has a large farm sector and would have been faced with a massive increase in payments to its own farmers.

Bonns surrender to Paris will now help repair strained relations between the two core states of the EU.

But it leaves untouched the key question of how the EU will carve up spending in an overall budget that is due to shrink in real terms.