EU agricultural subsidies reduction faced criticism by East German farmers
In a significant turn of events, farmers in the eastern German states are voicing their concerns and opposition towards the European Commission's proposed reforms to the Common Agricultural Policy (CAP) subsidies. The Commission plans a major overhaul starting after 2027 that would merge agricultural subsidies and regional cohesion funds into a single, centralized budget mechanism, known as the "National and Regional Partnerships."
This reform, aimed at simplifying and centralizing the system, would eliminate the CAP’s traditional two-pillar structure, including the dedicated rural development pillar, which currently supports agro-environmental initiatives, farm investments, and rural communities. The planned cuts and redistribution of funding under this new system effectively mean reduced direct support and increased competition for funds within a broader budget encompassing defense, innovation, and infrastructure.
The shift has sparked protests by farmers in several EU countries, notably Hungary, where farmers dumped manure in protest of expected cuts. While specific protests from eastern German farmers have not been detailed, the broader farmers' associations across Europe, including those in eastern Germany, are expected to oppose these changes fiercely.
The concerns of eastern German farmers revolve around:
1. The loss of rural development programs previously funded under CAP’s second pillar. 2. Funding now being funneled into a single pot that increases competition with other policy areas. 3. Reduced direct subsidies affecting farm incomes and investment capacity. 4. Greater national and regional discretion in fund allocation, possibly leading to uneven distribution.
The farmers' associations of eastern German federal states, including Saxony, Saxony-Anhalt, and Thuringia, have sharply criticized the EU's plans. The vice-president of the Saxony Farmers' Association, Thomas Thiele, described the plans for limiting and cutting funding as a "slap in the face." The president of the Thuringian Farmers' Association, Klaus Wagner, demanded that the EU Commission must change its proposals back to the current system. Saxony-Anhalt's Minister of Agriculture, Sven Schulze, spoke of a radical restructuring at the expense of farmers, while the vice-president of the Saxony-Anhalt Farmers' Association, Sven Borchert, criticized the Commission arbitrarily setting criteria for who is needy and who is not.
Despite the criticisms, the majority of agricultural subsidies will continue to flow as direct payments to farmers, with the amount largely dependent on the area farmed. Each EU country will draw up its own National Reform and Investment Plan, allowing them to allocate more money to farmers than Brussels has stipulated. The EU Commission's President, Ursula von der Leyen, presented long-term plans for the European budget from 2028 to 2034, which sees an overall increase in the budget by 700 billion euros to two trillion euros. However, only 300 billion euros are allocated for farmers.
The Brandenburg State Farmers' Association accused the EU Commission of endangering food security for people. Billions in EU funding flow annually to farmers and agricultural corporations in Central Germany, with distributions more unequal compared to the rest of Germany. The ongoing debate underscores the significant impact these reforms could have on the financial support and rural livelihoods of farmers in the eastern German states and across the EU.
- The controversy over the European Commission's proposed reforms to the Common Agricultural Policy (CAP) has extended to the financial industry, with many analysts predicting potential instability in the agricultural business sector due to the changes.
- The business community, particularly agricultural organizations, is closely monitoring the developments in political negotiations, understanding that the CAP reforms could have far-reaching implications for remaining competitive in the broader finance landscape.
- Meanwhile, general-news outlets are covering the grassroots protests across various European countries, emphasizing the role of these events in shaping the future dynamics of agricultural, finance, and political relationships within the EU.
