Fræðaþing landbúnaðarins - 08.02.2008, Blaðsíða 19

ALÞJÓÐLEG ÞRÓUN f LANDBÚNAÐI | 17
Agriculture and Environment:
Towards an “Health Check” of the Common Agricultural Policy
Luca Montanarella
European Commission
During the last 15 years, the common agricultural policy (CAP) changed radically in
response to pressures from European society and its evolving economy. The
2003/2004 reforms marked a new phase in this process, introducing decoupled direct
payments via the Single Payment Scheme (SPS) in most sectors of the first pillar of
the CAP and strengthening Rural Development (RD) policy as its second pillar. This
process continued with reforms in sugar (2006) and íruit and vegetables (2007), and is
ongoing with the recent legal proposals for reform in the wine sector.
Producer support is now to a large extent decoupled from production decisions,
allowing EU farmers to make their choices in response to market signals, to rely on
their farm potential and their preferences when adapting to changes in their economic
environment, and to contribute to improving the competitiveness of the agricultural
sector. As a result, CAP reform delivered what was expected from it by shifting away
from product support, widely viewed as an origin of the surplus problems of the past.
EU support prices, reduced everywhere, are by now close to world markets. The
competitiveness of EU agriculture is increasing in key sectors, despite the decline of
the EU share in most commodity markets, and the EU is already the largest
agricultural exporter, of mainly high value products. It is also the biggest agricultural
importer in the world, remaining by far the largest market for developing countries.
Furthermore, the CAP increasingly contributes to heading off the risks of
environmental degradation and to delivering many of the public goods that our
societies expect. Producer support is now dependent on the respect of standards
relating to the environment, food safety and quality and animal welfare.
Finally, the strengthened rural development policy supports the protection of the
environment and rural landscapes and creates growth, jobs and innovation in rural
areas. Although a growing number of EU rural areas will be influenced by factors
outside agriculture, areas which are remote, depopulated or heavily dependent on
farming will face particular challenges as regards economic and social sustainability.
Thus the role of the agri-food sector, which still represents more than 4% of total
GDP and 8% of total employment, remains critical in many rural areas.
Three crucial new challenges for EU agriculture lie in the areas of climate change,
bio-energy and water management. Climate change is the pivotal challenge of the
three, influencing developments in the other two areas. In mitigating the effects of
climate change, EU agriculture has contributed more than other sectors to curbing
green house gas emissions. This is mainly due to the improvement of production
methods (i.e. more effícient use of fertilizers) and diminishing cattle numbers. But the
agriculture sector will be called to contribute more in the future as part of the EU
global strategy for curbing emissions. But EU agriculture is also highly exposed to
climate change. A wide range of concems relates to uncertainties about precipitation
pattems, extreme weather events, temperature levels, water availability, and soil
conditions. Consequently, there is also the need for adjustments to improve adaptation