Brussels, 23/06/2008 (Agence Europe) - In Luxembourg on Monday 23 June, the EU Council of Ministers adopted, without debate, a regulation on the reform of the aid system in the cotton sector. The new regulation will mean that 65% of aid will be “decoupled” (not linked to production), with 35% still linked to cotton production in the form of area payments. National restructuring schemes (with €4 million for Greece and €6.143 for Spain) have been put in place to help restructure the ginning sector and improve the quality and marketing of the cotton produced. The new system will replace the current aid regime, which was annulled by the Court of Justice on 7 September 2006.
The European Union's international commitments will be met, in that the decoupled part of the aid falls within the WTO's “Green Box”, i.e. aid which does not lead to trade distortion. The remaining 35% of coupled aid, come under the “Blue Box”, which covers aid linked to production limitation and which is based on area and yields. Therefore, aid in the “Amber Box”, aid which distorts trade, has been removed. In the new regulation, national base areas that could benefit from coupled aid under the Single Payment Scheme are as follows (figures for the 2004 reform in brackets): Bulgaria, 3,342 hectares (10,237 ha); Greece, 270,000 ha (370,000 ha); Spain, 48,000 ha (70,000 ha); Portugal , 360 ha (360 ha). Coupled aid is calculated by multiplying a fixed yield by reference amounts. The reference amounts per tonne of non-ginned cotton are as follows: Bulgaria, €671.33; Greece, €251.75; Spain, €400.00; Portugal, €252.73. (L.C./transl.rt)