CEJA Conference - Political actors and representatives of the agricultural sector exchanged views on the future of the CAP and the risks and opportunities involved with the globalisation of agriculture
Following the opening speech of the CEJA Conference of 2 July 2015 in Ettelbrück, entitled 'Empowering young farmers - a pillar of Europe 2050', a first discussion panel addressed the risks and opportunities involved with the globalisation of the agricultural sector. A second panel then focused on perspectives for the Common Agricultural Policy for 2030 and 2050.
Risks and opportunities involved with the globalisation of the agricultural sector
The first discussion panel of the CEJA-conference in Ettelkbrück, on 2 July 2015
For Jean Feyder, Luxembourg's former ambassador to the UN and the WTO, the policy of liberalisation impoverishes "countries in the South", which trade deficit continues to grow. According to Jean Feyder, the fact that in 2014, the 54 African States imported USD 24 billion worth of food, resulted in significant losses in terms of jobs and revenue in African agriculture and led to an increase in poverty and famine in rural areas. "For example, in Ghana, 30 years ago, all poultry was produced by small local producers, whereas today 90% is imported from, inter alia, Brazil, the United States and the EU", explained Jean Feyder, stating that European exports to these countries are carried out "below the cost of production", so much so that local producers "are no longer competitive".
"Consequently, each year, 50 million people with poor prospects move away from the countryside to live in shanty towns where their lives are not better", stated Jean Feyder. This explains why so many Africans migrate to Europe.
In this context, it is his view that the EU must be "fair" and "show solidarity" and "allow African countries to implement a food sovereignty model that has been used successfully in Europe for many years".
In the opinion of Beat Röösli from the World Farmers' Organisation (WFO), globalisation presents new opportunities but also raises many questions for farmers who are particularly concerned with increasing price volatility. Globalisation also creates a framework favourable to industrialised agriculture which generates "a lot of criticism", in so far as, in his view, it does not allow sustainable production.
For their part, Jean-Marc Trarieux, from the European Commission's Directorate-General for Agriculture, and Winfried Meyer, Senior Vice-President of the dairy cooperative Arla Foods, pointed out the opportunities of globalisation.
Jean-Marc Trarieux welcomed the fact that the EU is currently the world's largest exporter of agri-food products and that, in 2015, these exports are set to increase despite the Russian embargo. He believes that the long-term prospects for European agricultural products are positive as a result of growing emerging markets. This is due to a rising world population and demand from the middle classes who increasingly expect high-quality products.
Jean-Marc Trarieux considers that, in this context, the EU should pursue an ambitious policy of free-trade agreements with Asian and African countries, with "support" from the agricultural sector.
With regard to the negotiations with the United States on the TTIP, Jean-Marc Trarieux stated that this agreement could benefit the European agricultural sector, in particular its high-quality products such as wine, spirits or dairy products that are "highly appreciated by American consumers". Nevertheless, the representative of the Commission emphasised that "this must be done without compromising on our production, health and environmental standards".
"The globalisation of agricultural markets implies that we must look for opportunities in emerging markets such as Latin America, Asia and Africa - we have no other choice", concluded the representative of the Commission who considers that potential damage can be prevented by finding "ad hoc solutions" for sensitive products.
"We must adapt to the market", added Winfried Meyer. In order to do this, Arla Foods has developed a strategy which involves, in particular, "developing the core market", especially the northern European market, and responding to growing emerging markets, for example in Dubai or countries in South East Asia. She believes that the strength of the European dairy industry lies in the quality of its products and its capacity for innovation. Its weaknesses lie in the cost of milk production and the fact that the dairy industry is "fragmented" and operates with "overcapacity".
Perspectives for the Common Agricultural Policy for 2030 and 2050
Invitation to the conference of the European Council of young famers (CEJA) on 2 July 2015
The second panel focused on perspectives for the Common Agricultural Policy towards 2030 and 2050. Harald Grethe, lecturer at the University of Hohenheim in Germany, gave a presentation on the reform of the Common Agricultural Policy (CAP) in which he concluded that the CAP has made "little progress" and that it fails to respond to the current challenges. He criticised the fact that "greening" payments, which represent 30% of direct payments made to farmers and which are subject to sustainable agricultural practices, are merely "cosmetic" and have "limited effects". The CAP comprises two pillars: direct payments (per hectare) and rural development policy.
Harald Grethe called for a shift of 30% of the money from the first to the second pillar, showing himself to be very critical of direct payments which he considers to be an "outdated model" which "makes no sense" because direct payments are "not defined, not targeted and have limited effects". "We need a clear signal that direct payments will be done away with", he stated, taking the view that direct payments are not vital to the survival of farmers and calling for more targeted measures. He was also critical of the fact that direct payments often support agricultural landowners and not the farmers who are leasing land.
Following the presentation, there was a round table discussion with five farmers: Luxembourg's Marco Gaasch, President of the Chamber of Agriculture in Luxembourg, Ireland's Alan Jagoe, Vice-President of the CEJA, Martine Hansen, Luxembourg MP (CSV) and two German MEPs Ulrike Müller (ALDE) and Martin Häusling (Greens/EFA).
Martin Häusling MEP agreed with Harald Grethe's arguments, considering that "finances are distributed in Europe" without "regulatory interference" or "structural support". He believes that we need an "exit strategy" for direct payments which would have driven prices down, as in the example of milk producers who survive only with the support of European subsidies. He is convinced that the European Parliament will cut funding to the CAP, which represents 40% of the EU budget, given all the problems that Europe is facing.
Ulrike Müller MEP stressed the need for a generational shift, highlighting the fact that 63% of European farmers are older than 63 whereas only 0.8% of farmers are younger than 25 years of age. She made a passionate plea in support of direct payments which represent an important income for farmers, in particular in terms of investments. She cited the results of a study which show that 67% of direct payments contribute directly to the income of farmers.
Marco Gaasch lamented the fact that agricultural production has become more industrialised, in particular as a result of the rising world population. Instead of criticising direct payments, he called for alternative proposals, believing that farmers rely on European funds to support their income. He maintained that "CAP funds redress the balance of what consumers are willing to pay".
Martine Hansen disagreed that greening measures are merely cosmetic, referring to the high demands in this context. She took the view that rural development and animal welfare will become increasingly important.
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