Farms and forests cover most of Europe’s land and are vital for our health and economy. The EU's common agricultural policy ensures that farming and preservation of the environment go hand-in-hand. It helps develop the economic and social fabric of rural communities and plays a vital role in confronting new challenges such as climate change, water management, bioenergy and biodiversity.
True Parmesan cheese merits an EU quality label.
EU agricultural policy is constantly evolving. 50 years ago, the emphasis was on providing enough food for a Europe emerging from a decade of war-induced shortages. Subsidising production on a large scale and buying up surpluses in the interests of food security are now largely a thing of the past. EU policy aims to enable producers of all forms of food - from crops and livestock to fruit and vegetables or wine - to survive by themselves in EU and world markets.
To this end, EU agricultural policy has undergone significant changes in recent years. The legal texts were shortened and made easier to read. Almost 80 legal acts have been scrapped as part of what is technically known as the single Common Market Organisation.
Financial safety nets are still in place, but are used much more selectively. For example, the common agricultural policy (CAP) steps in with financial support for farmers hit by natural disasters or outbreaks of animal diseases, such as foot-and-mouth or bluetongue.
Where necessary, the CAP supplements farm income to ensure that farmers make a decent living. However, assistance is linked to compliance with broader objectives in the areas of farm hygiene and food safety, animal health and welfare, preservation of traditional rural landscapes, as well as bird and wildlife conservation.
Choice at a fair price is a fundamental tenet of EU agricultural policy.
The reforms have freed funds to promote internationally competitive, quality foodstuffs, innovation in farming and food processing, as well as rural development, including the diversification of rural economies. In a public consultation on agricultural product quality policy, the key challenges identified by EU farmers were global competition and meeting consumer demand.
Consumers have become much more quality-conscious, so voluntary EU labels help them make educated choices. There are labels for foodstuffs with a clear geographic origin, for food made with traditional ingredients or using traditional methods, and for organic food.
EU research budgets further support innovation in agriculture by increasing productivity while making farming more environmentally friendly. Projects have included research into how agricultural crops can be used to produce energy without detracting from the primary purpose of producing food and animal feed, e.g. by using by-products and waste products.
The policy reforms have also been in the interest of fairer world trade. They have reduced the risk that EU subsidies for exports of surplus production will distort world markets. In the so-called Doha Round of international trade liberalisation talks, the EU has proposed eliminating export subsidies altogether by 2013, even if the talks fail.
As part of the Doha Round, the EU has also offered a significant reduction in import duties on agricultural products. However, even without these, the EU is already the world’s largest importer of food and the biggest market for foodstuffs from developing countries.
The most recent development is a 'health check' of agricultural policy, which describes a series of changes decided by EU leaders in 2008. It was an opportunity to ensure the policy is fit for new challenges and opportunities, such as climate change.
The health check modernises, simplifies and streamlines the CAP and removes restrictions on farmers, helping them to better respond to signals from the market and to face new challenges. For example, it abolishes the requirement to leave 10% of arable land fallow, increases milk quotas gradually leading to their abolition in 2015 and uses market intervention (EU purchase of excess supply) as a safety net when food prices are unsustainably low. In addition, direct payments to farmers will be reduced and the money transferred to a fund for the development of rural regions.
Reforms notwithstanding, the common agricultural policy is the most integrated of all EU policies and consequently takes a large share of the EU budget. Nevertheless, its portion of the EU budget has dropped from a peak of nearly 70% in the 1970s to 34% over the 2007-2013 period. This reflects the expansion of the EU's other responsibilities, cost savings from reforms and the new focus on rural development, which will be allocated 11% of the budget over the same period.
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