Development aid workers, human rights activists and environmentalists have long demanded the abolishment of EU farm subsidies. UN secretary general Ban Ki Moon and the Pope both consider it an important measure to be taken in order to fight famine in Africa effectively. It is not a secret that these agricultural aid payments, which take a large share of the EU budget, are negatively affecting local farmers on African markets. Some claim it to be one of the main reasons for the severe underdevelopment of many African countries.
The Common Agricultural Policy (CAP) first came into existence in the late 1950s when the six EU founding states were suffering from a decade of war-induced shortages. Its implementation was then crucial to provide enough food for the European people by rebuilding the war-damaged agricultural sector. Basically, the CAP provided incentives to increase production of agricultural products by paying subsidies that awarded highly productive farmers whilst at the same time guaranteeing high prices for the produced goods. This subsidy policy was very successful and within a short period of time the initial goals were met, the EU managed to increase its agricultural productivity decisively and the Western European market could be satisfied. However, very soon European productivity started to exceed local demand resulting in the production of surpluses. As a consequence, the farming industry started to export its surpluses of basic food products, mainly to Africa. Due to the governmental subsidies, European farmers can offer their products on African markets below the actual production costs and still make a profit. Local African products cannot compete with the cheap imported goods which leads to local farming businesses being ousted from their domestic markets.
Unlike most of the EU member states, the agricultural sector is still of high importance in most African countries. In some countries, Uganda being one example, up to 80 per cent of the work force is engaged in the agricultural sector. Usually a large number are smallholder farms. In Zambia, for instance, small scale farms represent 90 per cent of the rural population. Smallholders usually depend on the agricultural production with regard to their own consumption. Therefore, the EU policy is not only endangering their businesses but also their general food access.
Apart from that, small agricultural businesses in Europe suffer from the policy as well. Since EU subsidies depend on the size of the cultivated area, the largest businesses receive the highest amount of direct payments. It truly is a policy privileging huge agricultural companies. Naturally, the over-cultivation also harms the environment.
Due to much criticism in the previous years, countries are now obliged to publish the recipients and the amount of subsidies they received. A requirement that Germany for instance only met a couple of months ago after a procedure was opened against the country for refusing to publish the subsidy beneficiaries. A glance at the list of receivers explains who might have had an interest in the delay. The top of the list consists almost exclusively of large food producing companies that received direct payments amounting to millions during the past year.
It is a step towards the right direction that today everyone can easily look up recipient companies and the amount of money they get. However, this is not getting us anywhere if the knowledge that is available is not being used and people, especially EU citizens who are financing the subsidies with their taxes, are not aware of the negative impacts this policy is causing. Even then, it seems impossible to actually influence European policy making that most of us do not really understand and do not even consider it worthwhile to take part in the elections.
It is true that due to reforms within the past years expenses for agriculture decreased relative to other EU expenses. From a peak of 70 per cent of the total budget, the amount has now declined to 43 per cent. Nevertheless, this is still a lion’s share compared for instance with the 3 per cent expenditure on development aid. Even though the European Union does not spend too much money on this crucial issue anyway, the spending can still be considered completely useless. The EU is trying to compensate deficits which it is causing by its own policy. If the EU pursued a more sensible policy regarding agriculture, a lot of money that is now ineffectively spent on development aid could be saved. European tax payers are currently financing the misled agricultural policy that amounts to approximately 50 billion euros per year and costs each tax payer about 100€ annually. Out of this sum, 30 billion euros are used for direct payments to mainly large companies. According to some estimates, 30 billion euros is approximately the sum needed to effectively boost the African agricultural production. This is an essential measure to be taken considering the growing world population which is said to rise to nine billion people by 2050. If Africa does not succeed in building up a functioning agricultural sector, it will be impossible to feed all these people. The other 20 billion euros remaining from the budget should be used for a more sensible policy within Europe, supporting environmental friendly production, food safety and animal welfare.
It is not hard to see that there is something seriously wrong with the EU farm subsidies. It has been criticised so many times, many ‘experts’ are demanding its immediate abolishment, especially in order to stop the negative impacts on Africa. At one point, the EU discussed cancelling the agricultural payments by 2013 and now they have set the goal to reduce the expenses to 32 per cent by that time. While the complete abolishment is postponed to some unknown point in the future, the issue is far too crucial for Africa’s development to be put aside.
