The issue of the external convergence of aid in the Common Agricultural Policy 2024-2034 is gradually returning to the forefront of the discussions of the Ministers of Agriculture.

Among the Member States of the European Union there are differences in the amount of aid, especially between the “old” and the “new” members of the “27”.

Usual “suspects” of the pressures of the discussions in this direction are primarily the Baltic countries (Estonia, Latvia, Lithuania), Slovakia, Bulgaria, Poland and Romania, however, they avoid mentioning the multiple reasons for the existence of these differences.

Other countries affected by the issue of external convergence are Italy, Belgium, the Netherlands, Denmark, Slovenia and Cyprus. Greece intends to “build” alliances with these states to avoid any “unpleasant surprises”.

As the Secretary General of Agricultural Policy and International Relations of the Ministry of Rural Development and Food, Kostas Baginetas, explains to the Athens-Macedonian News Agency, “in the Multiannual Financial Framework 2021-2027 and in the latest reform of the CAP, a gradual partial external convergence of aid was foreseen (during last two periods 2014-2020 and 2021-2027 with the Union gradually covering part of the difference) while with regard to the next MFF (2028-2034) and with the assumption that the Union will proceed with a full gradual convergence of aid (in seven equal steps) , it is expected that the resources for our country will decrease significantly. In particular, it is estimated that in the next MDP 2028-2034 the resources for the 1st pillar will be reduced by approximately 24% or in absolute amounts of 3.17 billion euros or by 450 million. euros per year”.

What is true for our country

For our country, external convergence is a very important issue as Greece ranks second among the 27 Member States in terms of the amount of direct aid per hectare, while the average aid per hectare it receives is approximately twice the average of European Union.

As Mr. explains to APE-MBE Bayonetas “in the theoretical scenario where full external convergence was applied from the 1st year of the previous MFF (2021-2027) the losses would amount to about 42%, i.e. about 895 million. euros per year or 6.28 billion euros in seven years”.

And he adds “our country would have the biggest losses, in absolute numbers, followed by Italy (with approximately 5.2 billion euros), a fact that was avoided in the demanding negotiation for the MDP in 2021, with the intervention of the Prime Minister himself, Kyriakos Mitsotakis”.

However, according to the c.g. of YPAAT “the distribution and amount of aid in each member state is an extremely complex and multifactorial issue, as they contribute decisively to economic, social and environmental ambitions and requirements. Thus it becomes clear that a holistic approach is required in dealing with the equation of aid, if we want to support fairer distribution, beyond the simplistic and one-sided criterion of area”.

Direct aid resources, within a Member State, are allocated according to specific needs and flexibilities, in order to more effectively achieve all of the EU’s objectives. For example, in our country three agronomic regions are recognized (arable crops, permanent crops, pastures) on the basis of which income support is based.

What happened at the last council of ministers of agriculture

The last “battle” for external convergence was given at the Council of Ministers of Agriculture & Fisheries held at the end of October in Luxembourg.

Greece has clearly expressed its complete opposition to the proposed report on external convergence of direct support (Pillar I-CAP), as it raises concerns about the impact on the agricultural sector. “This specific proposal does not agree with us and raises serious concerns. For us, this is an extremely sensitive issue” pointed out Mr. Bayonet.

Among the arguments proposed by our country was that, external convergence:

– in its current form, it does not appear to contribute to the objectives of the CAP as described in the EU’s Treaty on the Functioning of the EU. In addition, the Treaty, providing that: “When drawing up the common agricultural policy and the specific methods involved in its implementation, account shall be taken of:

a) the particular nature of agricultural activity, which results from the social structure of agriculture and the structural and physical inequalities between the various agricultural areas,

b) the need to gradually apply the appropriate adjustments,

c) the fact that in the Member States agriculture is a sector closely linked to the economy as a whole’, recognizes the particularities that must be taken into account when implementing the policy. Full external convergence based solely on extent goes against the declared objectives of the Treaty.

– with the exclusive criterion of area, it overlooks the particular nature of agricultural activity as well as the structural, physical and economic inequalities between agricultural areas, i.e. it does not take into account:

* the soil-climatic characteristics / areas with natural or other disadvantages and the type of crops (risk of desertification),

* input costs including land and labor costs,

– does not take into account the impact on employment and overall economic activity, properly taking into account:

* the difference between the average agricultural income and the average income in the other sectors of the economy,

* the viability and competitiveness of agricultural holdings.

– it does not take into account the amount of aid per farm and transfers resources, within the EU, from small family farms to larger ones with a high average income, increasing inequalities. It must be taken into account, especially for our country:

* the amount of aid per holding (VAT),

* the average holding size and the number of small farmers.

– it does not optimize the provision of public goods and the added value of the CAP as the reward for farmers to adopt environmentally sustainable practices differs in each MS.

* There is a marked difference in the cost of climate and environmental public goods services between MSs to maximize their output (which directly affects farmers’ reward for ecoschemes).

– it will make unsustainable a large number of farms (mainly the small and multifunctional ones in Greece but also in other MS), since they will face a significant reduction in their incomes. In such a case, the agricultural activity runs a serious risk of being abandoned, with incalculable consequences for the economy, social cohesion, the environment and the food security of the EU itself.

– The distribution of direct payments should favor agricultural productivity in order to ensure EU food security.