Subsidies without farming : the reform of the CAP : current and future pressures

Abstract

The GATT agreement has been a major factor behind the current reforms of the CAP essentially providing an external constraint on policy developments. This has enabled a radical switch from unlimited support based upon price, to area/headage payments subject to limits. The EU Commission argue that these reforms, in general, will be sufficient to meet the obligations under the GATT agreement. However over the long term it is generally recognised that the current reforms are not sustainable and further reforms will be necessary. The direction these take are open to speculation but are likely to include greater emphasis upon the provision of public environmental goods and less on production.