Agricultural Policy Reform in the EU and the Regional Environmental Policy

Abstract

The purpose of this paper is to discuss about the direction of the common agricultural policy in the EU and its attitude towards WTO agricultural negotiation. The EU announced the "Agenda 2000" in July 1997 as the new policy attitude in the 21st century. According to this, the common agricultural policy (CAP) has been reformed again since the last major reform in 1992. The purpose of the new CAP reform under the Agenda 2000 is (1) to strengthen the international competitiveness to adjust the world demand increase, (2) to mitigate the pressure from the surplus stock, (3) to balance the benefit levels derived from the CAP among member countries, (4) to prepare for joining of central & eastern Europe (EU enlargement) and (5) to take steps for WTO negotiation. It should be pointed out that not only the reform level but also the reform speed is significant from the viewpoint of wide-range-effects of the policy changes. Especially at the moment when there are big regional differences between the joining countries in central & eastern Europe and the member countries in the western Europe, this point should be emphasized. In a nutshell, it should take reasonable time to replace price support policy with direct payment policy, and also, it is important to lower, gradually not rapidly, the level of direct payment for regional revitalization and environmental conservation, depending on the improvement level of international competitiveness attained by the structural adjustment scheme