The Common Agricultural Policy Impact of CAP on new Member States, opportunities for the period and future outlook for the period Mihail Dumitru Deputy Director General DG Agriculture and Rural Development European Commission

1. Impact of the CAP on the New MS 2. CAP reform: New Policy, New Opportunities 3. Future Challenges 2

EU 10 CAP expenditure

RD Investments in competitiveness 4

Fewer Farms, Bigger Farms 5

Structural Adjustments 6

Evolution of land prices 7

From net-importer to net-exporter 8

9 However, the level of agricultural income is still lower than the average wages in the whole economy

New policy – new opportunities CAP

CAP objectives 11 Challenges Environmental Economic Territorial Policy objectives Sustainable management of natural resources and climate action Balanced territorial development Viable food production Reform objectives Improved sustainability Enhanced competitiveness Greater effectiveness

12 CAP reform changes in direct payments: objectives Ensuring the long-term viability of farms Providing a basic layer of fixed income support Making them less vulnerable to fluctuations in prices and income Enhancing the sustainable management of natural resources Reflecting the important role of agriculture in the joint delivery of private and public goods Supporting agricultural practices beneficial for the environment and climate change Contributing to territorial development Allowing for structural and production diversity Supporting agriculture in specific areas with significant spillover effects on food supply chain and rural economies

CAP reform changes to direct payments 13 More equitable distribution Improved targeting Active farmer Young farmers Green payment Specific support to territories, sectors and size Convergence of payments among MS Convergence of payments among farmers Redistributive payment Greener direct payments Mandatory practices beneficial for environment and climate 30% of direct payment budget Streamlined cross-compliance

CAP-reform changes in Rural Development Improving the strategic approach to constructing RDPs; Strengthening the content of rural development measures; Simplifying rules and / or reducing the related administrative burden where possible; and Linking rural development policy more closely to the other ESI funds. 14

15 Habitats Biodiversity Economic viability Resource management Socio-economic context Food Culture and values Energy Biomass Challenges and Opportunities

16 3. Food chain organisation and risk management 4. Restoring, preserving, and enhancing ecosystems 5. Resource efficiency and climate change 6. Diversification and social inclusion 2. Economic viability and competitiveness 1. Knowledge transfer and innovation SUSTAINABLE RURAL DEVELOPMENT Union Strategic Priorities for Rural Development 16

Innovation Farm Viability Food Chain Rural Economy Environment Sustainable Rural Development Quality Schemes Natura 2000 and WFD payments Agri-environment and Climate Measures "Green" Direct Payments Business Development ANC Payments EIP LEADER - CLLD Forest Measures Advisory Service and Knowledge Transfer Investments Complementarity of Measures 17 Climate

Programming Measures per Focus Area: An Example Priority 5: Promoting resource efficiency and supporting the shift towards a low carbon and climate resilient economy in agriculture, food and forestry sectors Focus areas Efficiency in water use Efficiency in energy use Supply and use of renewable energy Reducing GHG and ammonia emissions Carbon conservation and sequestration Investments in physical assets Farm and business development Village renewal and basic infrastructure Knowledge transfer Advisory services Investments in forest area development Co-operation (new technologies) [….] -List of operations -Eligibility rules -Aid-intensities -Beneficiaries -Verifiability -Indicative budget -Other conditions, etc. Measure details (example) Grouping of relevant measures Indicators Targets (result) Planned expenditure Planned outputs

New concepts based on existing succesful approaches: Networking Agri- environment Support for Competitiveness LEADER Broader Rural Development

Local Development Strategies: LEADER/CLLD Linkages between develop- ment actions integrated multi- sectoral Local innovation cooperation networking Analysis of the development needs and potential of the area Objectives, including clear and measurable targets for outputs or results Community involvement in the development of the strategy Action plan Management and monitoring arrangements Financial plan(viable budget)

21 Risk Management (Art RDR) 1)Crop, animal, and plant insurance (insurance premiums) 2)Mutual funds for adverse climatic events, animal and plant diseases, pest infestations and environmental incidents 3)Income stabilisation tool

Financial Instruments 1. Support for all investment operations under the RDP 2. Compulsory ex-ante assessment for any FI 3. Variety of financial instruments and types of implementation 4. Contribution to EU level instruments 5. Phased payments linked to disbursements to final recipients 6. Compulsory reporting from the outset, on a range of indicators linked to the financial regulation.

Innovation: pilot projects, clusters and EIP Environmental co-operation Provision of biomass Social farming Forest management plans Short supply chains/local markets 23 Cooperation (art 35 RDP) Investments, advisory service, training and other measures

EIP-Agri Rural Development Horizon 2020 Setting up "operational groups" involving farmers, advisor, agribusiness, research, and NGOs Project funding for activities of operational groups, possibly combined with other measures (investment, knowledge transfer, advisory services) Promoting innovation support services EIP-AGRI Network Research projects, including on-farm experiments to provide the knowledge base for innovative actions Interactive innovation formats such as multi-actor projects and thematic networks genuinely involving farmers, advisors, entreprises,…."all along the project"

25 European Level National Level Common Provisions Regulation for ESI Funds Covering the EAFRD, ERDF, ESF, CF, EMFF Reflecting EU2020 through 11 common thematic objectives to be addressed by key actions for each of the funds Partnership Agreement National document outlining the intended use of the funds in the pursuit of EU2020 objectives Rural Development Programme(s) (Other funds' operational programmes) National or Regional Level Coordination and Complementarity with ESI Funds

2014 – 2020 EAFRD funding / MS (EUR million)* *The envelopes to be in place after 2nd round of transfers between Pillars, COMMISSION DELEGATED REGULATION (EU) No 1378/2014, amending Annex I to Regulation (EU) No 1305/2013 of the European Parliament and of the Council and Annexes II and III to Regulation (EU) No 1307/2013 of the European Parliament and of the Council ** includes EU level technical assistance (239 mil. EUR)

How are MS programming? Snapshot from the Baltic Sea region 28

Estonia 70% of agricultural area under contract for biodiversity & 71% for soil Nearly 50% of agricultural land under contract for GHG reduction Raising the competitiveness of agriculture: more than 4% of farms to receive investment support Young farmers: more than 3% of farms will receive this support people trained and 15 cooperation projects 60% rural population covered by a local development strategy 29

Poland Strong focus on modernisation and competitiveness in milk, beef & pig sectors farms to benefit from modernisation support or start up aid Investment support to farms, creating jobs and 1800 producer groups Environment and climate action projects covering 18% of Poland's agricultural land people benefit from training and demo projects 30

31 Lithuania Modernisation of small and medium-sized farms (livestock and fruit&veg sectors) Setting up support support for young farmers Risk management: farms to take part in the scheme; 29 projects on biogas production Biodiversity & soil schemes on resp.11% & 8% of agricultural land Nearly new jobs in rural areas Training for more than people Lithuania Modernisation of small and medium-sized farms (livestock and fruit&veg sectors) Setting up support support for young farmers Risk management: farms to take part in the scheme; 29 projects on biogas production Biodiversity & soil schemes on resp.11% & 8% of agricultural land Nearly new jobs in rural areas Training for more than people Denmark Green Conversion and 1000 new Green Jobs High priority to Organic farming, doubling area to 12% of agricultural land investment projects to improve environmental performance in farms Restructuring of 8% of Danish pig and cattle farms 700 investments to reduce GHG emissions, creating 200 jobs Innovation (100 co- operation projects + EIP) Training for people Denmark Green Conversion and 1000 new Green Jobs High priority to Organic farming, doubling area to 12% of agricultural land investment projects to improve environmental performance in farms Restructuring of 8% of Danish pig and cattle farms 700 investments to reduce GHG emissions, creating 200 jobs Innovation (100 co- operation projects + EIP) Training for people Finland 81% of agricultural land under contract for environmental objectives High priority to animal welfare participants in training with focus on innovation 310 co-operation projects new jobs from diversification creation and development of small enterprises Service innovation in rural areas for 1.8 million Finns Finland 81% of agricultural land under contract for environmental objectives High priority to animal welfare participants in training with focus on innovation 310 co-operation projects new jobs from diversification creation and development of small enterprises Service innovation in rural areas for 1.8 million Finns Latvia Improving farm perfomance in more than 4 % of farms 14 % of agricultural land under contract for environmental and biodiversity objectives Organic farming given high priority (conversion and development) Training will be provided for people Risk management tools for 5% of Latvian farms Latvia Improving farm perfomance in more than 4 % of farms 14 % of agricultural land under contract for environmental and biodiversity objectives Organic farming given high priority (conversion and development) Training will be provided for people Risk management tools for 5% of Latvian farms

Future Challenges 32

Challenges in the shorter term Focus on implementation; policy delivery and achieving objectives Need for stability once RD programmes are settled Continuing efforts to simplify and reduce administrative burden 33

Challenges in the longer term Climate Change New Markets Growth & Jobs Resource Constraints Innovation & Technology 34

Thank you for your attention 35