Brussels, 17/06/2002 (Agence Europe) - The German Chancellor, Gerhard Schröder, has repeated that Germany is not prepared to negotiate with candidate countries over direct aid for their farmers until the EU has decided the broad outlines of how to reform its Common Agricultural Policy (CAP). In July, the Commission will be unveiling its proposals for the "mid term" review of the 1999 Berlin decision on agriculture, taken in the framework of Agenda 2000, and in an article for the 16 June edition of the Frankfurter Allgemeine Sonntagzeitung, Schröder writes that Germany will not decide on what it can offer candidate countries in terms of direct aid until the "first outcome" of the CAP reform is known. The EU offer (by which he means the EU's common negotiating position) has to be presented to the candidates, argues Schröder, at the Copenhagen European Summit in December, and not before. At that Summit, the EU is planning to conclude the accession negotiations with up to 10 new Member States, each of which will understand that we cannot negotiate with candidate countries over direct aid until we are aware of these proposals, explained Schröder, and until the "first outcome" of the reform is known. In Germany's view, the CAP reform must result in a general levelling down of direct aid and hence a cut in agricultural expenditure (a quarter of which is paid by Germany). In order to not hold up the enlargement process (Schröder stresses in the article that Germany has always been and will remain a fervent defender of enlargement), he suggests leaving direct aid aside for the moment and continuing the accession negotiations on the remaining 95% of the agriculture chapter in the run-up to the Copenhagen Summit. Germany is supported in this by the UK, the Netherlands and Sweden. Schröder also repeated Germany's position that direct aid is not part of the Community acquis and the candidate countries have no right to demand to be automatically incorporated into this part of the CAP. According to the decision taken at the March 1999 Berlin Summit, says Schröder, direct aid was only foreseen for farmers in current Member States in order to compensate for price cuts. This can be regretted, and I have to admit that I am not happy about it either, but it is a fact: Agenda 2000 was approved in Berlin by all fifteen Member States and it does not foresee funding for direct aid for candidate countries. Extending the CAP in its current form to a 25-country EU would lead to a EUR 8 billion increase in agricultural spending each year. Germany alone would have to bear a quarter of this, namely EUR 2 billion a year, stressed Schröder, and we could not agree to that even if we wanted to because Germany has pledged to its EU partners that by 2004 it will be presenting a close-to-balance budget and it has reached the limit of what it can afford. If I agreed today, said Schröder, to extend the direct aid system, then as from tomorrow Commissioner Solbes could start writing a string of blue letters (warnings to Member States under the Stability Pact). Schröder also rejected the idea (raised by Germany's opposition) of national cofunding for direct aid on the grounds that such a proposal would be staunchly opposed by France (as happened in Berlin in 1999) and would discriminate against future Member States, not all of which can afford to co-fund direct payments to their farmers. The only realistic way was to relaunch the CAP reform process as soon as possible in order to be in a position to make decisions on direct aid in December, said Schröder.
Meanwhile, the European Commission has repeated its own position, clearly contradicting Germany's, that direct aid is part of the acquis and new Member States therefore cannot be excluded from this aid, in the words of a Commission spokesperson. The financial framework decided in Berlin enables direct aid to be phased in over a ten year period, as the Commission has proposed for 2004-2013, explained the spokesperson.