EU farm subsidies to stay unequal

In a blow to Czech farmers, French President Jacques Chirac blocked reform of the European Union's Common Agricultural Policy (CAP) at the Oct. 23-24 EU enlargement summit in Brussels. The summit agreement maintains subsidy levels for farmers in the 15 EU member states and guarantees that new members will receive only 25 percent of the current subsidy level. The Czech Republic had hoped to prop up its agriculture sector with EU subsidies. It is expected to enter the EU in 2004. Chirac's victory -- France receives the greatest proportion of farm subsidies -- has riled this country's struggling farm sector, where output has declined by 15.5 billion Kc ($500 million) year-on-year. Jiri Tomec of the Plzen (Pilsen) Agricultural Chamber said the EU subsidy plan would "liquidate" Czech farmers and keep them from being competitive. Farm subsidies account for nearly half the EU's budget of 95 billion euros (3.1 billion Kc/$96.9 billion), and the World Trade Organization, as well as many NGOs, are calling for fair competition, urging the EU to decrease CAP spending. A last-minute summit compromise agreement pushed through by Germany and France kept the CAP at approximately 45 billion euros annually until 2013. The EU's 10 candidate countries, particularly Poland, with its large agricultural sector, had been pushing for subsidies that came closer to what farmers in member states were receiving.