ZAGREB, September 7, 2018 – The Croatian Chamber of Commerce (HGK) and the Ministry of Agriculture expressed their concern over a proposal for a new Common Agricultural Policy (CAP) for the next long-term EU budget 2021 – 2027, which foresees less funds for Croatia, and called for postponing the proposed cuts until 2023.
Companies from the agricultural and food industries held a meeting at the HGK with representatives of the chamber and the ministry to discuss the European Commission’s CAP proposal.
The purpose of the meeting was to inform companies of the latest developments regarding the next seven-year budget period and how to strengthen the negotiation platform toward the EC and other EU institutions with the aim of achieving a better position for Croatia’s agricultural sector.
Under the EC’s proposal, presented in June, Croatia’s allocation in the next seven-year budget would be 4.035 billion euro from CAP or 4.544 billion euro if inflation is taken into account, with a little more going to direct payments to farmers and a little less for rural development.
The EC has proposed three new regulations related to direct payments, rural development measures, mechanisms establishing a common organisation of markets and quality schemes for agricultural products and foodstuffs and these regulations should be adopted no later than 2020.
Dragan Kovačević, the HGK vice-president responsible for agriculture, forestry and fisheries, said that the proposed CAP reform contained radical changes, including an overall reduction of the budget by 5%. He added that in the 2021-2027 period, Croatia would receive 70 million euro less annually for direct payments and rural development.
Under the EC proposal, the reduction for Croatia will be about 4% for direct payments and as much as 15% for rural development measures, Kovačević added.
That means that the annual envelope for direct payments will be reduced from the current 382.6 million euro to 367.7 million euro (about 15 million less), Kovačević said, adding that he was particularly worried that the allocation for rural development would be reduced from the current 332.2 million euro to 281.3 million, a cut of 50.8 million euro.
He underscored that that would be an additional blow to the competitiveness of Croatia’s agricultural sector and that the burden of the reform should not be carried by the weakest and newest member states, like Croatia. He announced that a request would be made for the reductions to be postponed until at least 2023.
Kovačević added that, because it was the last country to join the EU, Croatia had had the least opportunity to use the benefits of the EU’s agricultural policy.
As for other reform proposals, Croatia does not support the proposed increase in the national contribution for agricultural measures in the second pillar nor does it support an increase in contributions related to climate and environmental protection.
A state-secretary at the Agriculture Ministry Tugomir Majdak said that the ministry does support the EC’s proposal to give priority to small and young farmers but is against setting the envisaged limitations and wants the matter to be decided by national authorities.
Finally, the ministry doesn’t think that the EC’s CAP proposal will in fact facilitate policy planning and implementation, said Majdak.
