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France and Germany on Tuesday published a joint position on their vision of Europe's agriculture after 2013 but did not agree on the budget that should be allocated to EU's common agriculture policy (CAP).
-- Joint position does not include agreement on budget level
-- Opposes flat-rate payments
-- EU quality standards should be met by imported products
The agriculture ministers of the two largest countries in the 27-member bloc agreed in Berlin on the main issues they will defend in the upcoming CAP reform but financial aspects would need to be tackled as part of the wider EU budget, they said.
"Agriculture needs stability and visibility. A final decision on all questions relating to finances will be made when decisions are made on all policies and the entire EU financial framework," the joint position statement said. The position was announced during a visit in Berlin by French Agriculture Minister Bruno Le Maire to his German counterpart Isle Aigner.
Talks are about to start on the post-2013 CAP budget, now worth more than 40 percent of the EU's budget of about 130 billion euros ($167.3 billion) annually. With public finances under extreme pressure as Europe tries to manage the economic crisis, many question whether the EU can still afford to devote so much cash to farming.
The Commission's budget chief told Reuters last week in an interview farm aid should be reduced to about one third of the European Union's budget and spending could be shifted towards research and innovation. France, which received 9.5 billion euros from the CAP last year - more than any other EU country - is leading the push to maintain current farm spending levels.
The position of Germany, which pays more into the EU's coffers than any other country, is therefore a key factor in the talks. Aigner had said in June that the CAP budget must remain stable after 2013 but it was not clear whether her view was shared by the finance ministry in Berlin. Concerning direct payments made to farmers, France and Germany reiterated they would not accept a flat rate per hectare system, as suggested by several member states in order to have a fair and adequate allocation of financial funds.
The current level of direct EU payments to farmers varies from over 500 euros per hectare in Greece to less than 100 euros in Latvia, with amounts based mainly on historical production levels. Large beneficiaries justify the gap by higher costs.
Paris and Berlin vowed to defend current market instruments, including intervention and private storage, to protect farmers against the effects of major crises. France and Germany want EU member states to retain the possibility of keeping, on a voluntary basis and within national ceilings, an "envelope of flexibility" dedicated to specific needs (such as sustainable development), provided it does not create distortions in the internal or international markets.

Copyright Reuters, 2010

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