Tuesday

26th Jan 2021

EU farmers to get €500mn shot in the arm

  • Several thousand farmers came to Brussels to protest (Photo: Peter Teffer)

The European Commission is offering half a billion euros in support for the bloc's struggling agricultural sector, most notably for dairy farmers.

However, EU agriculture ministers were unable on Monday evening (7 September) to reach agreement on how to divide the money.

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“A lot is still unclear”, Dutch minister for agriculture Sharon Dijksma told reporters after the meeting.

They agreed to meet again on Tuesday (15 September) in Luxembourg.

According to EU commissioner Jyrki Katainen, filling in for agriculture commissioner Phil Hogan due to latter’s illness, the “most significant part” of the €500 million package will be in the form of targeted aid for all member states.

“It will be a significantly bigger amount than in 2009 when the national envelope was €330 million”, Katainen told press.

He noted that, once it is clear how much each country will receive, it will be up to national governments to decide how to further distribute the money, because the problems vary per country.

A sticking point for coming days will be for the national governments to agree on a distribution key.

“It's always challenging [to agree on distribution] but I don't expect any major challenges because everybody recognized the need to solve the problems as soon as possible”, Katainen said.

Katainen also said European farmers will be able to receive a larger portion of their subsidies as an advance in mid-October.

National governments will be able to pay up to 70 percent of farmers' EU subsidies for 2016 from 16 October 2015, up from the currently permitted 50 percent.

The idea is designed to alleviate one of their biggest problems: lack of cashflow.

In 2013, the average European farm received €5,628 in direct subsidies.

The figure of €500 million was reached by looking at what was possible within the current EU budget, rather than what was needed to finance certain measures, a commission source told this website.

A chunk of the sum comes from the higher-than-expected fines that member states have had to pay for overshooting their milk quota.

The European Commission had initially expected to raise €440 million as the so-called “super levy”, but this turned out to be €810 million. The rest of the aid package was found in other budget windfalls.

Katainen also proposed linking the struggles in the agricultural sector with the increasing numbers of EU-bound migrants.

“We don't have any concrete decisions yet, but there is strong will within the commission that those two issues should be linked together as well as possible”, Katainen said, adding that both issues “must be addressed at a European level” and “synergies between responses” is required.

A press statement by the commission said: “there are ways of addressing the nutritional needs of refugees, for example through the distribution of dairy products”.

Katainen noted that he was “very satisfied to hear the feedback” after he presented the proposals to the European ministers.

The ministerial in Brussels went on while protesting farmers marched through the city.

According to Belgian media, the atmosphere became more grim once the protesters reached the European area and the Schuman square, the location of the building where the ministers' meeting took place.

Dozens of protesters threw stones, beer bottles, and sticks at the police, who used tear gas and water cannon in response.

What the protesters thought about the outcome of the meeting remains to be seen. They had left the Schuman square by the time the press conference took place.

Why are European farmers unhappy?

EU farm ministers will hold a special meeting to discuss the pressures facing farmers across the bloc. But many factors are beyond their control.

Agriculture ministers accept Commission aid plan

Most of the EU's agriculture ministers were cautiously optimistic about the EU Commission's €500 million aid package for Europe's struggling farmers, after receiving additional details.

Budget deal struck, with Hungary threat still hanging

Ultimately, the European Parliament managed to squeeze an extra €16bn in total - which will be financed with competition fines the EU Commission hands out over the next seven years, plus reallocations within the budget.

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