East wannabes in talks about talks
East wannabes in talks about talks
Brussels is preparing to take in another
six member states as it presses on with
its plans for eastward enlargement. The
process has raised some serious
questions on both sides of the former Iron
Curtain. Europe editor, Philip Clarke,
examines the issues
REPRESENTATIVES from the first wave of countries looking to join the EU from the east were in Luxembourg this week to start negotiations on the thorny subject of agriculture.
"Negotiations" is perhaps too strong a word for it. The meetings with the EU Commissions top brass amounted to little more than an exchange of prepared statements setting out already entrenched positions.
From countries such as Poland, Hungary and the Czech Republic came the usual demands for full access to EU subsidies from the day they join, with as many derogations as possible.
The commissions view is that, first, the candidate countries must be able to handle complex policies like the CAP, have fully functioning markets, with uninhibited access for outside investors.
On the vexed question of direct payments to the millions of peasants, the commissions traditional response has been "no way!"
After all, area aid and headage payments were supposed to compensate existing EU farmers for price cuts. In contrast, many of the countries about to join the EU will enjoy price increases, so why should they be compensated?
Indeed, the financial package agreed in Berlin last year makes no provision for any such payments throughout the period 2000-2006. Instead, k3.7bn (£2.3bn) a year has been earmarked for rural development and infrastructure improvements.
This approach is entirely right. To make immediate direct payments to countries where the average rural wage is little more than $100 a month would create huge socio-economic distortions and inflationary pressures.
It would also discourage them from making essential improvements to their farming and processing sectors, necessary for them to perform in the EU market.
But why take them in at all? From the British farmers point of view, there are considerable fears about what enlargement will mean. More competition from cheaper imports? Lower quality food jeopardising the home market? Burgeoning surpluses of commodity products? An increased drain on our taxpayers pockets?
Furthermore, it is abundantly clear than the EU institutions cannot cope with 15 member states. What chance have they with 21?
But eastward enlargement is being pursued at a higher political level. EU leaders are desperate to embrace the new economies of the east to generate wealth through trade, to prevent a drift back to communism and, ultimately, to create a Europe at peace.
Despite these altruistic objectives, agriculture is far from an irrelevance.
Brussels realises it cannot ride roughshod over the aspirations of the farmers in the east, or disregard the concerns of producers in the west.
As such, there has been a sea change in its thinking on direct subsidies. In a recent speech, agriculture commissioner Franz Fischler hinted that some income support may be available.
Without direct payments, it would be impossible to ask the acceding countries to apply the CAPs supply control instruments needed to prevent surpluses.
Furthermore, Brussels realises it cannot operate a two-tier common agricultural policy for long. Some direct aid will have to be paid to the new members. And while this will initially be at a lower rate than paid to existing EU farmers, over time the two will have to meet.
Some erosion of current CAP payments seems inevitable. The question is, over what timeframe?