CAP reform heads changes at the European Union

17 July 1997

CAP reform heads changes at the European Union

Reform of the Common Agricultural Policy (CAP) was named yesterday as
a priority in the proposed radical shake-up of the European Union (EU)
to cope with its enlargement.

The enlargement to take-in five former Communist states plus Cyprus
will be after 2000. But the EU announced changes to its
agricultural policies to coincide with the formal announcement of their
eventual membership. Negotiations between Europes agricultural
ministers start next week.

The first stage of the reforms will be a plan to phase out guaranteed
EU market prices for cereals, beef and dairy products. This measure
could mean prices slashed by one-third between 2000 and 2002 as support
is removed that keeps European Union prices above world levels. This
will be accompanied by a huge shift towards farmers on low incomes.
Money is to be spent on rural development. The farm lobby has labelled
the changes as catastrophic. The CAP currently accounts for about 50%
of the EU budget, and 40% of the agricultural allocation goes to France
or Germany.