CAP health check must result in level playing field

Saturday, November 15, 2008

EU agriculture commissioner Mariann Fischer Boel should have the confidence to press ahead with further decoupling, but others must follow if the UK is not to be put at a disadvantage, says the NFU.

UK farmers could be at a competitive disadvantage if countries around the world do not support further decoupling of agricultural support from production, the NFU has warned.

Speaking ahead of next week's CAP health check negotiations in Brussels, NFU president Peter Kendall said Europe should press ahead with developing a more market-oriented policy framework and not be tempted back down the route of subsidies coupled to production.

But all countries - including those within Europe - had to move together to create a level playing field, he said.

"Decoupling allows markets to find redress and we should all support that. But if Europe is to take the lead on decoupling, everyone needs to follow suit. We don't want to see countries such as France use Article 68 of the draft regulations [which develops the concept of the national envelope] to increase coupled payments."

The USA's decision to put an extra $20bn towards trade-distorting measures under its Farm Bill, India's subsidy of fertiliser markets to the tune of 2.5% of its GDP, and China's 135% tariff on urea exports were all examples of measures that had to be removed for a free market to work, Mr Kendall said.

On top of that, non-trade issues such as environmental degradation and animal welfare had to be given a higher priority around the world, he said.