Brussels, 19/04/2004 (Agence Europe) - Chaired by Joe Walsh, the EU agriculture ministers will try to reach agreement in Luxembourg on Wednesday on reforming 'Mediterranean' products (tobacco, cotton and olive oil). Member States have not changed their views since the 22 March meeting in Brussels, where huge disagreement surfaced over the future of tobacco farming (see Europe of 23 March 2004m p.11 and 24 March, p.11).
Negotiations will start at 11.00 hrs with trilateral discussions with each of the Member States on an initial draft compromise formulated by the Presidency (in agreement with the Commission). The Agriculture Council proper will meet at around 15.30 hrs to look at progress. There will then be an interruption of the meeting to make amendments to the compromise text. Negotiations are expected to continue into Wednesday night. The Member States' and Commission's views can be summarised as follows:
- Tobacco. Given the scarce room for manoeuvre available to Commission Franz Fischler, it will be very difficult to dissolve the blocking minority (Italy, Greece, Spain, Portugal and France) against full decoupling of aid for tobacco farmers, unless significant concessions are offered to some of these countries in other sectors (to Spain, for example, for olive oil or Greece for cotton). Fischler's spokesperson told reporters on Monday that the Commission may be flexible during the implementation of the reform, but not over full decoupling of aid, which is justified for economic reasons (tobacco farming is not competitive, being wholly subsidised by EU funding) and public health considerations (reducing smoking). The Commission has to take account of the position of non-tobacco growing Member States, like the UK, Denmark, Sweden and the Netherlands, which want an aid to EU tobacco aid. Fischler's spokesperson also mentioned Germany among countries wanting a change in the system, but Germany prefers partial decoupling of aid (it has a number of tobacco farmers).
Tobacco growing countries argue that full dccoupling of tobacco aid would lead to the disappearance of tobacco growing in the EU and the jobs related to it (135,000 in Italy and 10,000 in France). France, Italy and Spain believe the opinion of the European Parliament could serve as the basis of a compromise, the European Parliament recommending 30% decoupling for tobacco. Italy and France point out that the proposed reforms would not help reduce smoking in Europe since 70% of tobacco smoked in Europe is imported. These two delegations argue that EU tobacco would simply be replaced by an increase in imports. This view is not shared by the Commission, which says that the new system would facilitate diversification and improve the economies of the regions concerned. Fischler's spokesperson said that decoupling aid would allow the sector to preserve revenue and choose the type of farming that best suits it for the future.
- Olive oil. Spain wants 90% decoupling of aid (as opposed to the 60% proposed by the Commission), with a change to the reference periods (1998-2002 rather than 2000-2002) and a review of the national guaranteed quotas granted in 1998 (this point seems to be the trickiest area). Portugal and France are calling for new olive plantations to be taken into account (30000 ha and 3500 ha respectively) in aid calculations. Italy is prepared to consider greater levels of decoupling than proposed, as long as the Commission agreed to review the tobacco proposals.
- Cotton. Greece opposed the planned reduction of areas eligible for aid and is calling for Member States to be authorised to choose between full and partial decoupling. The Commission is suggesting a single rate, 60%. Spain supports the European Parliament's views, namely a decoupling of only 20%.
