November 21, 2008
European Union revamps farm subsidy rules
European governments compromised on new farm subsidy rules but a British official said the changes didn't go far enough.
I regret what has been conceded in order to secure a deal which will lead to some new distortions in the short term, British Environment Secretary Hilary Benn said, the International Herald Tribune reported Friday.
Critics said the compromise would only slightly shift the older subsidy set up that costs $53.9 billion a year, 40 percent of the European Union's $125 billion annual budget.
Changes include an increase in annual milk production quotas through 2015, when the quota system will end. Set-aside subsidies, which encourage farmers to leave fields fallow, will be abolished and direct payments to medium and larger farms will be reduced.
But, co-founder of Farmsubsidy.org, Jack Thurston told the Herald Tribune the policy shifts are minor because most of the friction involving agriculture concerns tariffs, not quotas or subsidies.
On paper these reforms make the European system more compatible with global trade rules, said Indhira Santos, a research fellow specializing in European agriculture.
In practice, Santos said to the newspaper,
there's really little difference because most of the money still goes to the same people.