Friday, June 24, 2005

Myths about the CAP

An excellent article by John Lichfield on CAP reform in the Independent today debunks various myths. Obviously the CAP needs further reform, but populist discourse usually obscures the following points:

EU farm prices are on average only 30 per cent above those in the world market.

Reform of a key flaw in the CAP – the fact that about 50% of the CAP payments go to 7% of recipients – was blocked by Britain, which has the biggest farms in the EU and thus opposed a move to set a ceiling on single farm payments.

Abolition of the CAP intervention prices would hurt many African and Caribbean farmers who depend on selling to Europe at CAP prices. It would probably also result in increased rainforest destruction for beef farming in Brazil.

Agriculture is the only area of public finance which has been transferred to the EU. The agriculture budget thus represents one half of 1% of European countries' GDP, compared to an average 40%+ of GDP taken by Governments.

France’s percentage receipt of CAP money is proportional to France’s share of European agricultural output.

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