What is the fu­ture for the ol­dest Eu­ro­pean po­li­cy : the CAP ?

Investir en Europe - - Actualites / News - Emi­lie BELET et So­fia DORBANI, étu­diantes Me­di­cis

The com­mon agri­cul­tu­tal po­li­cy (CAP) is the ol­dest Eu­ro­pean Union po­li­cy. It was crea­ted by the Trea­ty of Rome (1958) and exist since 1962. It was foun­ded on th­ree prin­ciples which are: the prices uni­que­ness, the pre­fe­rence of the com­mu­ni­ty and the fi­nan­cial so­li­da­ri­ty. The CAP asks for the agri­cul­tu­ral prices sup­port in­ter­ven­tions by the Eu­ro­pean Agri­cul­tu­ral Gua­ran­tee Fund (FEAGA) since the 1st Ja­nua­ry 2007. In 1992, the CAP was re­for­med for com­plete the prices sup­port by far­mer di­rects pay­ments with the pro­duc­tion mas­te­ry obli­ga­tion. Even if its share is de­crease in the EU bud­get, it ac­tual­ly re­pre­sents the 1/3 of the EU ex­penses.

The first ob­jec­tives of the CAP

The CAP is main­ly foun­ded on mea­sures of prices controls and sub­ven­tions for mo­der­nize and de­ve­lop the agri­cul­ture. It is im­ple­ment by Ge­ne­ral Di­rec­tion « Agri­cul­ture and Ru­ral De­ve­lop­ment » of the Eu­ro­pean Com­mis­sion. In France, it is exe­cu­ted by two agri­cul­tu­ral of­fices un­der the Agri­cul­tu­ral Se­cre­ta­ry. The CAP is com­po­sed by two pillars, the first is men­tio­ned above and the se­cond crea­ted in 1999 is for the ru­ral de­ve­lop­ment.

The foun­der ob­jec­tives:


the agri­cul­tu­ral pro­duc­ti­vi­ty

­as­sure a equi­table life le­vel for the agri­cul­tu­ral po­pu­la­tion ­sta­bi­lize mar­kets

­as­sure rea­so­nable prices for consu­mers

The impacts was to :

­sup­port know­ledge and in­no­va­tion trans­fers

­rein­force the com­pe­ti­ti­ve­ness and the du­rable ma­na­ge­ment of the fo­rest

­pro­mote the or­ga­ni­za­tion and the risks ma­na­ge­ment in the ali­men­ta­ry chain

­res­tore and pro­tect the eco­sys­tems

­pro­mote ef­fi­cient use of re­sources

­fight against the po­ver­ty in ru­ral zones

Mac Shar­ry (1992) and the Agen­da Re­forms (2000)

The 1992 re­form cal­led Mac Shar­ry has for ob­jec­tive to de­crease the CAP ex­penses bud­get. Par­ti­cu­lar­ly, in set up in­di­rect pay­ments which in­sure a mi­ni­mal price for far­mers pro­duc­tions. These pay­ments will be com­po­sed by di­rect pay­ments pro­por­tio­nal of the ex­ploi­ta­tions size for the pro­du­cers.

The Mac Shar­ry re­form was es­sen­tial in the im­ple­ment of the trade agree­ment Uru­guay Round (in­ter­na­tio­nal com­mer­cial ne­go­tia­tions of GATT since 1987 to 1994). This agree­ment had to gua­ran­tee in­ter­na­tio­nal and Eu­ro­pean ex­por­ta­tions sub­ven­tions.

In 1999, a new re­form is ne­ces­sa­ry for the Agen­da 2000. It fixed bud­ge­ta­ry pers­pec­tives for the per­iod 2000­2006 and take conse­quences by the East Eu­rope en­lar­ge­ment.

The Luxem­bourg Agree­ment – re­form of 2003

The Luxem­bourg agree­ment pre­pare the CAP re­form in 2003 who takes 1992 and 1999 ac­qui­si­tion and has two es­sen­tials ob­jec­tives. They are the pay­ments de­cou­pling and theirs condi­tio­na­li­ty. The pay­ments de­cou­pling consists by a par­tial re­pla­ce­ment of sub­ven­tions which are set­tled by the pre­vious re­forms. They are tie up to sur­faces and pro­duc­tions by a single pay­ment which is in­de­pendent of the ex­ploi­ta­tion ac­ti­vi­ty. The unique pay­ment be­came the ma­jor com­ponent of sup­port ex­penses mar­kets and agri­cul­tu­ral in­comes (the first pillar of the CAP).

The pay­ments condi­tio­na­li­ty sub­mits the pay­ment by norms res­pect in en­vi­ron­ment and the pu­blic health. For the du­rable de­ve­lop­ment of the agri­cul­ture, this re­form pur­poses to in­crease pay­ments for the non­mar­ke­ted of agri­cul­ture.

Trea­ty of Lis­bon (2009)

Since the Trea­ty of Lis­bon, the role of the Eu­ro­pean Par­lia­ment is streng­then on le­gis­la­tive, exe­cu­tive and fi­nan­cial as­pects re­la­ted to the CAP. It must work joint­ly with the Eu­ro­pean Union Coun­cil (art 43 TFEU)(1).

­The CAP is now a sha­red com­pe­tence bet­ween the Eu­ro­pean Union and the mem­ber states (art 4 TFEU) for the agri­cul­ture and the fi­shing. The bio­lo­gi­cal re­sources of the sea re­main the ex­clu­sive com­pe­tence of the EU.

Fur­ther­more, it is liable by the or­di­na­ry le­gis­la­tive pro­ce­dure.

­ The Eu­ro­pean Com­mis­sion po­wers is ad­mi­nis­tra­ted by the EU Coun­cil and the Eu­ro­pean Par­lia­ment par­ti­cu­lar­ly for the exe­cu­tion mea­sures of the CAP.

­The CAP bud­get is now de­ci­ded by the EU Coun­cil and the Eu­ro­pean Par­lia­ment.

The de­bate on the CAP re­form (2010­2013)

At the end of 2010, the Eu­ro­pean Com­mis­sion de­ci­ded to im­ple­ment an ac­tion plan on the CAP fu­ture na­med « the CAP to­wards 2020 : food, na­tu­ral re­sources and ter­ri­to­ry ­ the chal­lenges of the fu­ture ». This pro­ject will be stu­died and ne­go­tia­ted by the Eu­ro­pean Par­lia­ment and the EU Coun­cil.

Be­sides, in the end of 2011, the Eu­ro­pean Com­mis­sion chose to orient CAP mea­sures to­ward an eco­lo­gi­cal di­men­sion par­ti­cu­lar­ly owed by the du­rable and ru­ral de­ve­lop­ment for the CAP.

In 2013, the UE in­tro­du­ced es­sen­tial prin­ciples for the CAP

­ The di­rect pay­ments for far­mers among 30% will be re­paid for the far­mers who are a du­rable agri­cul­tu­ral way

­The du­rable and ru­ral de­ve­lop­ment

­ The com­mon mar­ket or­ga­ni­za­tion who will be control by the Eu­ro­pean Com­mis­sion du­ring cri­sis per­iod

­ The fi­nan­cing more equi­table by coun­try and by far­mer.

It ge­ne­rates obli­ga­to­ry mea­sures like pay­ments de­crease for far­mers who have big ex­ploi­ta­tions and like pay­ments sup­ple­men­ta­ry for be­gin­ners far­mers.

The re­form of the new CAP 2014­2020

This re­form was obli­ga­to­ry to ans­wer at the pro­gram­ming se­ve­ral years obli­ga­to­ry since 1999, the pre­cedent pro­gram­ming was 2007­2013. The re­form of the CAP 2014­2020 was co­ming in­to force in 2015 and sup­por­ted on the pre­vious re­forms prin­ci­pal­ly the prin­ciples of the CAP de­ter­mi­ned in 2013.

The CAP struc­ture is un­chan­ged. The first pillar is de­ter­mi­ned by the di­rect pay­ments and the com­mon mar­ket or­ga­ni­za­tion fi­nance by the UE (1% of the Eu­ro­pean GDP). The se­cond group of the ru­ral de­ve­lop­ment mea­sures which are fi­nan­ced by the UE and the mem­ber states. On a bud­get of 362, 8 bil­lion of eu­ro for the per­iod 2014­2020, 278 bil­lion of eu­ro will be de­vo­ted to the di­rect pay­ments and 85 bil­lion of eu­ro will be de­vo­ted for the ru­ral de­ve­lop­ment.

The new ob­jec­tives are to al­low a bet­ter equi­ty bet­ween mem­ber states by stan­dar­dize the amounts per hec­tare at re­gio­nal le­vel for the far­mers and not ba­sed on a his­to­ri­cal di­men­sion. But al­so to set up en­vi­ron­ment prac­tices, obli­ga­to­ry and iden­ti­cal for all the mem­ber states.

Im­pact in France

The new ob­jec­tives of this re­form have ge­ne­ra­ted a de­crease of di­rect sub­ven­tions for France which is ac­tual­ly 7,5 bil­lion of eu­ro for the per­iod 2014­2020 and was 9,3 bil­lion of eu­ro du­ring the last per­iods. The French go­vern­ment im­ple­men­ted a bree­ding sup­port plan the 22th Ju­ly 2015 to ans­wer of the agri­cul­tu­ral crises pro­blems.

Ac­cor­ding to the speech of Ma­nuel Valls the 22th Ju­ly 2015, the first Mi­nis­ter of the France «The li­ve­stock sec­tor is going through a par­ti­cu­lar­ly dif­fi­cult per­iod that puts far­mers strain and that does not leave in­dif­ferent com­pa­triots».

Ac­cor­ding to Sté­phane Le Foll, the agri­cul­ture, the agro­bu­si­ness and the fo­rest mi­nis­ter in France, we can dis­tingue th­ree agri­cul­tu­ral cri­sis. For be­gin­ning, the swine cri­sis bound in the Rus­sian em­bar­go. The se­cond cri­sis is in the bo­vine en­vi­ron­ment where the bree­der can not co­ver their pro­duc­tion costs. And the last one, is the milk mar­ket, the pro­du­cers are in a more com­pe­ti­tive mar­ket in the Eu­rope. The mil­ky quo­tas are stop­ped in 2015. This bree­ding sup­port plan re­present 600 mil­lions of eu­ro and im­ple­ment 6 axes

­The rec­ti­fi­ca­tion of prices

­The re­struc­tu­ra­tion of the bank debts and the sup­pliers debts for far­mers and bree­ders

­The re­duc­tion and the ad­journ­ment of loads

­The de­ve­lop­ment in dif­ferent sec­tors

­The de­ve­lop­ment of mar­ket for the ex­port

­The im­pro­ve­ment of the com­pe­ti­ti­ve­ness of French sec­tors.

Fur­ther to this pro­gram­ming in­to se­ve­ral years 2014­2020, we can won­der how the CAP will evolve and how the CAP will be in­ter­pret in the EU mem­ber states in par­ti­cu­lar­ly in France.

Evo­lu­tion du bud­get de la PAC en mil­liards € et de sa part dans le bud­get eu­ro­péen

Ex­penses of the CAP – bil­lion €

% of EU bud­get

1980 to 2020 Sources: Ins­ti­tut na­tio­nal d’études su­pé­rieures agro­no­miques

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