The CAP reform process in perspective: issues of the post-2013 debate Tassos Haniotis, Director Directorate for Economic Analysis, Perspectives and Evaluations DG for Agriculture and Rural Development European Commission

T. HaniotisCAP perspectives 2 The long-term CAP perspective  The general context of the CAP debate –The question about “P” in the CAP –The question about the "C" in the CAP –The debate about the two pillar structure of the CAP  The post HC context of the CAP debate –Volatility in agricultural production and prices –Impact of the economic crisis on agriculture –Food security in the context of climate change and limited resources  The institutional context of the CAP debate –New European Parliament and Commission –Lisbon Treaty –WTO prospects

T. HaniotisCAP perspectives 3 Direct payments Basic rate Markets Rural development Innovation Environment Territory Income Structural adjustment Public goods Risk management Market instruments Food chain issues Other criteria GAEC Budget Economic crisis Economic crisis Climate change Climate change The CAP debate at a glance The CAP debate at a glance

T. HaniotisCAP perspectives 4 For further information  The CAP after  EU agriculture and CAP reform  Economic Analysis and Evaluation  Agricultural Policy Analysis and Perspectives

T. HaniotisCAP perspectives 5 Thank you

T. HaniotisCAP perspectives 6 Rural Development Direct payments Markets Pillar I Pillar II The CAP and the budget The CAP and the budget Modulation

T. HaniotisCAP perspectives 7 CAP expenditure and CAP reform path EU-10EU-12EU-15EU-25EU-27 Source: European Commission – DG Agriculture and Rural Development

T. HaniotisCAP perspectives 8 Alternative views on the cost of the CAP CAP cost in 2008 (in relative terms) CAP cost in 2008 (in absolute terms) 0.43% of EU GDP 44% of EU budget Source: European Commission – DG Agriculture and Rural Development

T. HaniotisCAP perspectives 9 CAP budget trends in perspective Source: European Commission – DG Agriculture and Rural Development

T. HaniotisCAP perspectives 10 Evolution of commodity price indexes ( )

T. HaniotisCAP perspectives 11 Cumulative reductions in EU price support Source: European Commission - DG Agriculture and Rural Development

T. HaniotisCAP perspectives 12 The evolving role of EU support prices - wheat Sources: European Commission - DG Agriculture and Rural Development and World Bank

T. HaniotisCAP perspectives 13 Impact of CAP reforms on EU net production surplus Sources: European Commission – Eurostat and DG Agriculture and Rural Development

T. HaniotisCAP perspectives 14 Recent trends in some commodity market prices Sources: European Commission - DG Agriculture and Rural Development and World Bank

T. HaniotisCAP perspectives 15 Long-term price evolution along the food supply chain Source: European Commission – DG Economic and Financial Affairs, based on Eurostat and Agriview data Agricultural commodity prices Food producer prices Food consumer prices Overall inflation (HICP)

T. HaniotisCAP perspectives 16 Direct payments per ha eligible area (excl. Malta*) *Malta: EUR/ha

T. HaniotisCAP perspectives 17 Share of DP and total subsidies in agricultural income Source: European Commission – DG Agriculture and Rural Development EU-15 EU-12

T. HaniotisCAP perspectives 18 EU developments in agricultural income (agricultural income/AWU in real terms) Source: Eurostat EU-15 EU-12

T. HaniotisCAP perspectives 19 Recent evolution of agricultural input and output prices Source: Eurostat

T. HaniotisCAP perspectives 20 The three RD thematic axes in the MS Source: European Commission - DG Agriculture and Rural Development