EU Common Agricultural Policy: Handy CAP or handicap for Romania?

By Friederike Mikulcak

Though the relevance of agriculture for the European economy has dramatically decreased since the adoption of the Common Agricultural Policy (CAP) in 1962, the policy is still highly relevant when discussing the prospects of sustainable rural development and biodiversity protection in Europe.

Photo by F. Mikulcak

When Romania joined the EU in 2007, the share of people depending on agriculture was disproportionately high (45% of the total, see Iorio and Corsale 2010). Four years later, many Romanians are still subsistence or semi-subsistence farmers that can hardly make a living from working their land. They are often poor, lack education and off-farm employment opportunities (e.g. Iorio and Corsale 2010). However, their traditional land use methods (i.e. absence of tractors or chemical fertilizers, cultivation of low-intensity crops, sustainable mowing and grazing) have contributed to high regional biodiversity. To underline the importance of these farming methods for nature conservation, the term High Nature Value (HNV) has been introduced (e.g. Paracchini et al. 2007). Against this background it is important to have a closer look at the design of the CAP and its ‘fit’ for Romania.

Historically, the Common Agriculture Policy was founded to increase food production in Europe during the Cold War, to ensure fair living conditions for farmers, and reasonable prices for consumers (EEA 2009). Yet, soon the CAP developed into a complex system of subsidies, income support mechanisms and agricultural funds which led to unanticipated side-effects such as overproduction, the homogenization of European landscapes, and a large-scale reduction of biological diversity (e.g. Stoate et al. 2001).

Considering increasing environmental concerns, the CAP was reformed in 1992. Among other changes, income support mechanisms for farmers were now decoupled from the productivity of a farm. Agri-environment payment schemes were introduced which were to promote the adoption of sustainable land management practices and agricultural stewardship. To foster the development of marginalized areas in Europe, the Agenda 2000 reform (year 2000) allowed for the creation of a ‘rural development pillar’ which was subordinate to the CAP. By means of the newly created European Agricultural Fund for Rural Development (EAFRD), the modernization and diversification of rural areas was now supported.

Source: DG Agri, The future of CAP direct payments, Agricultural Policy Perspectives Briefs, Brief nº 1 rev, January 2011, http://ec.europa.eu/agriculture/publi/app-briefs/02_en.pdf

Though highly relevant for Romania, the second pillar makes up but one fifth of the total CAP budget. Overall, direct payments from Pillar 1 and farm-centric measures under Pillar 2 are predominant. However, because more than 50 percent of Romanian household farms operate on less than 1 hectare of land, they are not eligible for direct payments (Gorton et al. 2009). As pillar 1 payments increase with the size of a farm, we now observe that large-scale farms over 1000 ha (representing only 0.5 percent of the total number of farms in Romania) receive one fifth of direct CAP aid (ibid.). Small-scale farmers can apply for certain Pillar 2 payments such as measure 141 (micro farmers, from 0.3 ha), 142 (producer groups) or the establishment of off-farm businesses. Yet, my research conducted in Central Romania (November 2011) showed that most farmers are not well informed about the EU and funding options. Information on EU funding is almost exceptionally distributed through government authorities. However, many of these lack the capacity to fulfil their role properly (see Wegener et al. 2011). Moreover, many farmers lack education and thus face difficulties in dealing with complex EU funding requirements. There are hardly any non-governmental (or ‘bridging’) organisations which could serve as facilitators. People are sceptical towards state involvement and are often unwilling to hand in personal data as they fear higher taxes. Participation is weak so that farmers hardly associate. The land register is incomplete and many farmers lack official papers documenting their land ownership. In case farmers managed to receive funding it was often no sufficient incentive to prevent them from abandoning their land, which is one of the main threats to biodiversity conservation in the region.

Given the  balance of resources between Pillar 1 and 2, a different farm structure in comparison to old EU members and moreover a lack of capacity to implement rural development measures in the new EU Member States, Gorton et al. (2009) conclude that the CAP was not appropriately designed for these countries. I would add that we have to consider the pace in which Romania’s accession to the EU was conducted. Both farmers and authorities were overwhelmed by complex regulations, without possessing the adaptive capacity to adjust to EU regulations.

CAP could be of advantage to Romania if it departed from the support of agro-industrial production patterns and instead focused on the second pillar, i.e. rural development. Here, agri-environmental payments targeted at maintaining extensive farming in areas of High Nature Value should be granted priority in policy design. Direct payments under Pillar 1 should be minimized for big farmers and regionally differentiated, whereby farmers in HNV areas should receive more funding. Under Pillar 2, HNV criteria should be integrated into the eligibility scheme of payments (EEA 2009). At the same time, the creation and work of bridging organisations should be supported that could help farmers in accessing EU funds, diversifying their incomes, and overall in strengthening capacities and innovation for rural development.

The CAP reform proposal that was published by the EU Commission in October 2011 only partially ‘caters’ for the needs of rural Romania. Though (non-governmental) scientific institutions dealing with agriculture and agronomy were suggested to be promoted in the future, the eligibility criteria for payments have not been tackled. On the contrary, new member states may devote even more funding to Pillar 1 (direct payments) compared to Pillar 2 (rural development). It is likely that the Romanian government will continue focusing on ‘competitiveness’ and ‘innovation’ as it does with its current Rural Development Strategy –thereby aiming at a Western European farming model. Bucharest seems to ignore that the country’s natural beauty and species richness could be one of its main competitive advantages. To sustain and foster this asset – rather than relying on modernization and intensification alone – would ultimately benefit the entire European Union.

Sources

European Environment Agency (2009), Distribution and targeting of the CAP budget from a biodiversity perspective, EEA Technical Report no. 12/2009.

Gorton, M, Hubbard, C, and L Hubbard (2009), The Folly of European Union Policy Transfer: Why the Common Agricultural Policy (CAP) Does Not Fit Central and Eastern Europe, Regional Studies 43(10): 1305–1317.

Henle, K, Alard, D, Clitherowc, J, Cobb, P, Firbank, L, Kull, T, McCracken, D, Moritz, RFA, Niemela, J, Rebane, M, Wascher, D, Watt, A, and J Young (2008), Identifying and managing the conflicts between agriculture and biodiversity conservation in Europe – A review, Agriculture, Ecosystems and Environment 124: 60–71.

Iorio, M and A Corsale (2010), Rural tourism and livelihood strategies in Romania, Journal of Rural Studies 26: 152–162.

Paracchini, ML, Terres, JM, Petersen, JE, Hoogeveen, Y (2007), High Nature Value farmland and traditional agricultural landscapes. Open opportunities in the development of rural areas, In Pedroli B, Van Doorn A, De Blust G, Paracchini ML, Wascher D & Bunce F (Eds.), Europe’s living landscapes. Essays on exploring our identity in the countryside, KNNV.

Stoate C, Boatman ND, Borralho RJ, Carvalho CR, de Snoo GR, and P Eden (2001), Ecological impacts of arable intensification in Europe, Journal of Environmental Management 63(4): 337–65.

Wegener, S, Labar, K, Petrick, M, Marquardt, D, Theesfeld, I and G Buchenrieder (2011), Administering the Common Agricultural Policy in Bulgaria and Romania: obstacles to accountability and administrative capacity, International Review of Administrative Sciences 77: 583-608.

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One thought on “EU Common Agricultural Policy: Handy CAP or handicap for Romania?

  1. Pingback: Happy birthday to our blog: One year of “Ideas4Sustainability” | Ideas for Sustainability

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