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EU: Proposals On Key Accession Issues Likely To Disappoint Candidates

The European Union's executive commission is due in the next few weeks to announce its plans for negotiations with the eastern candidate countries on two of the toughest issues in the accession process -- namely agriculture and regional funding. EU officials are already saying those proposals will call for a slow phase-in of agricultural subsidies for the new members -- a position sure to disappoint some of the candidates.

Prague, 10 January 2002 (RFE/RL) -- The European Commission is due by the end of January to announce its proposals on how the EU should handle negotiations with the eastern candidate countries on the difficult issues of agricultural subsidies and regional funding.

Reports from Brussels say the Commission proposals would set transition periods of between five and 10 years before the newcomers would gain the full agricultural benefits enjoyed by farmers in current EU states. The Commission's proposals must be considered and approved by the 15 member states, so they do not yet represent the EU's common position on the two issues. But any delay in payment of full subsidies would certainly be unpalatable for some candidates, in particular Poland, the largest.

An article in the 9 January "Financial Times" quotes an unnamed EU official as saying transitional periods are necessary to allow time for the process of agricultural restructuring in the candidate countries. The official said that if, for instance, Poland received the full amount from the moment of accession, there would be "huge economic distortions" within Poland, and no incentive would be provided to restructure the farming sector.

Polish officials reject this. A senior Polish diplomat, Piotr Kozerski, told RFE/RL that Warsaw wants full benefits from the first day of membership. Kozerski, a London-based counselor, says that's only fair, and that Poland would have severe problems in accepting less.

"Let me just explain, we are going to be in the [EU's] single market, so the big question is how it would be possible for one member country [namely Poland] to be treated differently from the other ones," Kozerski said. "What about a level playing field, what about the rules of competition, and so on. And then there will be no borders, no checkpoints, so it is very difficult to imagine [how it could be done]."

Kozerski says that Polish farmers' competitiveness will be undermined if they do not receive the same level of financial support as farmers in West Europe. And he goes on to say that there is a popular misconception that Poland has an unmanageably vast farming sector.

"The general view in Europe is that Polish agriculture is so big that it would absorb a huge amount of funding. That is very much exaggerated, because -- although the number of farms is very substantial -- not all of them, indeed only some of them, would be eligible, precisely because of EU rules which stipulate that you have to have a certain acreage of crops, or a certain quantity of livestock," he said.

At the other end of the scale from Poland is Estonia -- a small candidate country with a relatively small agricultural sector in its economy. Tallinn has no interest in long transition periods either. Spokeswoman Ehdel Halliste of the Estonian Mission to Brussels says her country wants the EU to differentiate its treatment of candidates, according to what each has achieved in terms of efficient farm reform. She quotes Estonian Foreign Minister Toomes Ilves as saying, "The individual approach to candidate countries is also important, [regarding] agriculture, because the state of agriculture and also the reforms carried out in the area of agriculture [are] different in candidate countries, and this should also be reflected in the solutions that are found during the negotiations."

A London-based political and economic analyst, Heather Grabbe of the Center for European Reform, says however that it would be a "quite serious" error to give the candidates full farm subsidies from day one, because that would only encourage "completely market-distorting developments in agriculture."

Grabbe also sets out the background to the debate. She notes that the current EU farm budget runs to 2006, so that if the front-running candidates enter the union by 2004 -- as is foreseen -- they would have two years of partial subsidies, because that is what is already provided for in the budget to end in 2006.

"The question is, what happens with the following budget period, which runs from 2007 to 2013," Grabbe said. "What they have in mind at the moment is that the commission and people who would like to finish negotiations with the candidates on time, namely at the end of this year, they would like to postpone discussions of the budget until after the accession negotiations [are finished], to simply leave [aside] that question of what happens after 2006."

This would be a classic EU tactic, namely to make progress by sidestepping the hard issues and leaving them for solution in the future. Grabbe continues, "For the candidates, that has the disadvantage that they cannot ensure that they will gain access to funds after 2006, but it has the great advantage of ensuring they can actually finish their accession negotiations."

Grabbe says the big danger is that the EU could become totally bogged down in the debate about agriculture and simply would not finish the accession negotiations on time. At worst, she says, the eastward enlargement of the Union could even be blocked.