Baltic Farmers: Don't let the recovery exacerbate inequalities
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Brussels, May 26 2020 - In a letter sent to the President of the European Commission, a coalition of farmers from Estonia, Latvia and Lithuania has urged Europe’s leadership to use the next Multiannual Financial Framework to ensure a strong and fair recovery after the COVID-19 pandemic. Farmers' concerns were shared by the three Baltic Leaders who called on the Commission to 'ensure a level playing filed across EU policies, including in all elements of the CAP'. While the current crisis affects all parts of the economy and society, it is crucial that the recovery does not exacerbate existing inequalities among farmers across the EU.
Covid-19 has upended the way all Europeans live and work. Farmers across Europe need to adapt to a rapidly evolving food demand, increased price volatility, as well as disruptions putting our food security in danger. Direct payments under the Common Agricultural Policy serve as a safety net for farmers in times of a crisis. Nevertheless, Baltic Farmers remain exposed as they receive the lowest direct payments in the EU, 54-60% of EU average, while their actual production costs are much higher than the EU average, amounting to respectively 129% (Estonia), 112% (Lithuania) and 113% (Latvia). The income of farmers in the Baltic States thus depends much more on the market situation than in other countries.
The issue of the unfair distribution of direct payments dates to the EU accession phase of the Baltic states is a long standing anomaly, with the initial payment calculations based on a period during which the countries were undergoing major land reform transitioning from the Soviet centralized model to family farming structures. The result of an unprecedented drop of productivity during those years, which obviously did not show actual production capacity, was taken as reference. This has led to a historical but ongoing injustice.
The effects of this injustice become more evident in times of a crisis. Baltic farmers are working to provide healthy, nutritious, local, fresh food to all Europeans. Nevertheless, the first current signs on the ground are raising uncertainty and anxiety. The situation strongly resembles the impact of the 2014 Russian Embargo on EU agricultural products, which affected Baltic farmers disproportionately, with a solution only coming at crunch time. Furthermore, in the current crisis the reflex of many EU member states was overly protectionist, breaking the Single Market, at least momentarily.
Baltic Farmers think that an ambitious recovery plan and a fair CAP must be a tool to bring Europe united out of this crisis.
As the EU’s leadership is currently working towards a new budget to support Europe’s recovery, this is a unique chance to fix this injustice and increase the resilience of the food supply chain as a whole. According to the Baltic Farmers, it will be key to maintain a high ambition for the future MFF, that ensures that no-one is left behind. On agriculture, they call for maintaining allocations for both pillars of CAP, enabling further market measures, and accelerating the convergence of direct payments towards a fairer system of distribution. A representative of the farmers called for a fair and ambitious CAP in the next MFF, saying that: “Agriculture can be a way to grow out of this crisis. But a chain is as strong as its weakest link. We cannot let Europe’s food supply chain collapse. We ask Europe to treat all links as equal in its future budget and stop treating Baltic farmers as second class citizens ”.
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Notes:
Seven years ago, in February 2013, the European Council unanimously agreed that, “by 2020 at the latest, all Member States should reach the level of at least EUR 196 per hectare at current prices”. Since then, Baltic farmers have continued to systematically receive no more than 54-60% of the European average in direct payments, despite repeated calls for an end to this unfair distribution of funding which does not reflect the realities of agriculture on the ground in the Baltic countries, and does not help them finance practices beneficial for climate and the environment. The latest proposals before COVID-19, didn’t seem to address this injustice.
