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NATURRÅDET / TEMARAPPORT / NATUR OG LANDBRUG
74
The WTO context
In this context it is important to keep in mind that
by the end of this year a new round of international
trade negotiations will be launched by the
World Trade Organisation (WTO). Here, too,
agricultural support mechanisms will come under
review. The WTO distinguishes three different
types of agricultural support:
“Amber Box”: Including traditional measures of
market and price support, which had to be reduced
already under the present agreement. Here,
further reductions will be required.
“Blue Box”: In particular farm income compensation
payments for agricultural policy reforms.
Under the present agreement they are protected
by a peace clause until 2003. Yet, they will be the
main target for future reductions.
“ G r een Box”: Includes measures that are fully
decoupled and thus legitimised as permanent
support mechanisms. They cover in particular
a g r i - e nvironmental incentives and regionally targeted
measures, such as support for areas facing
specific handicaps.
Shifting priorities
If the EU agricultural budget is considered in this
p e r s p e c t ive, significant changes can be observed
having taken place over the last decade. Today, the
c h a l l e n ge of Agenda 2000 is to launch yet another
shift (Buckwell & Sotte 1997). In 1990, the
greatest share of EU-agricultural expenditure wa s
devoted to the regulation of agricultural markets
and prices. Funds were used to finance intervention
costs, stocking of surpluses, subsidies fo r
export dumping. With the ‘92 reform a decoupling
of price and income support has been achieved.
Expenditure for market and price policies
(amber box) were reduced and replaced by direct
payments compensating for the income effects of
the price cuts (blue box). In parallel, also other
direct payments increased in importance, although
at a much slower rate: The compensation
payments for natural handicaps in less favoured
and mountain areas (LFA), and the remunerations
for positive environmental services provided
by farmers under the agri-environmental regulation
2078/92 (green box). Finally, also the funding
for rural development measures gained in
importance, encompassing farm investment aid
as well as measures supporting rural infrastructure
improvement, and more broadly for the creation
of new economic opportunities in rural
areas, reaching beyond the agricultural sector
(Figure 8).
The next steps
With Agenda 2000 this tendency should continue,
but only in the short term: The costs of
market and price policy should be further reduced,
while compensation for price cuts will
increase initially. In the longer term, however,
these compensation payments will have to be
reduced, not only due to WTO pressure on blue
box payments, but also because their legitimation
is fading away. It is thus crucial that with Age n d a
2000 new options are established to gradually
shift future CAP expenditure towards green box
compatible measures that can be defended both
internally and internationally. In the present
Agenda 2000 debate, many agricultural ministers,
often impressed by the protests of traditional
farm lobbies, are reluctant to prepare for such
options. There is strong resistance to any attempt
of broadening the sectoral focus of agricultural
policy towards a more integrated rural development
perspective, taking on board agri-environmental
and nature conservation concerns. In
particular, the Commission proposals to finance
such measures from the G u a r a n t ee section of
the European agricultural fund are strongly criticised.
Here the Commission should be backed up
by politicians and NGOs caring for env i r o n m e ntal
and nature conservation concerns. If this is not
achieved, there is a great risk that the means for
promoting sustainable rural development will
be lost entirely. We would all be losers, not only
farmers, but rural Europe in general, its people, its
landscapes, our common cultural and natural
heritage.