The Rural Voice, 1981-08, Page 13Farmers protected in Europe
The European Community stands united in a support system for farmers.
by Adrian Vos
While Canadian politicians pay lip service to agricultural
protection, the European Community (EC) has an elaborate
system of support for farmers solidly in place.
The philosophy of the EC is deeply rooted in wartime
experiences. Countries which couldn't protect their food
production starved. There is not a ghost of a chance that the EC
will give in to American and Canadian pressure for relaxed
import barriers, if this means harm to their farmers.
This may be frustrating to the exporters of Canadian farm
products, but it makes a whole lot of sense.
Even the Japanese, who can only produce a small amount of
the food needed for their population are very protective, often to
the anger and frustration of their consumers.
There are, in fact, very few countries that do not hinder food
imports if they threaten their farmers.
In Canada it is eminently sensible, not just for reason of food
self sufficiency, but also by reason of the great influence our food
exports have on our balance of payments, that farmers be
protected.
The balance of payments, of course, is important to any
country and the Europeans do a lot of juggling among
themselves. But in their policies in extra European trade, they
stand united.
If Denmark has a surplus of pork, for instance, Holland
doesn't want this surplus on the EC market in competition with
its own. So the EC has a policy of export rebates (subsidies). If
the stockpile of EC pork reaches a certain level, or if the price
drops below a certain predetermined amount, this subsidy
becomes effective. This enables the Danes to compete in world
markets with Canadian pork.
To protect its agriculture against imports, a sluice -gate levy is
put in place. This levy varies. It is connected with the EC cost of
production, which is quite high. Whenever an imported product
is lower in price than the EC cost of production, a levy is imposed
which makes the new sluice -gate price an impenetrable barrier
against the imports of that particular product.
Protests against this system have been unsuccessful, and the
system was agreed upon by Canada at the Tokyo Round of
GATT agreements.
Internally, all farmers are protected by an internationally
negotiated base price. It prevents EC countries from subsidizing I
their farmers in any way at a higher level than agreed upon. The
Germans, for instance, strongly protested the advantage Dutch
greenhouse producers have because of lower priced Dutch
natural gas. They have apparently the right to demand this price
be increased.
Not everything works perfectly, even in the socialist
environment of the EC. Like the US, the EC has a subsidy
program for dairy products without a quota system. And just as
in the US, the market amounts of dairy products soon became a
mountain. Butter, and butter oil, were sold to the Russians for a
tew cents a kilo, to tne aismay or tne tt.. consumers, who had to
pay the full price.
After years of butter and milkpowder surpluses, there is now a
penalty system in place. A dairy farmer who increases
production by a certain amount over the previous year now has to
pay a disposal levy. The levy system was effective and the butter
and milk powder mountains disappeared.
Of the EC budget, about seventy-five per cent goes to support
EC agriculture.
There are periodic demonstrations at the EC offices in
Brussels by farmers who think its prices are too low. Sometimes
these demonstrations are violent and have even involved full
liquid manure spreaders. Most times it's the ministers of
agriculture from the various countries who are pitted against the
treasurer or agricultural commissioner, trying to get more for
their farmers.
Internal EC policies are often bitter and raise the fear that the
EC may break up. For instance, France protects her sheep
industry against British imports, as well as against New Zealand
lamb.
Italy began inspectipg every trailerload of pork from Holland
for salmonella and found some. Then every truck had to wait for
five days at the border until cleared by the inspection service,
with the possibility of being sent back.
Whether or not one agrees with the methods, it is nevertheless
clear Europeans attach great importance to food production, and
in that there may be some worthwhile messages for Canada.
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THE RURAL VOICE/ AUGUST 1981 PG. 11