Agricultural Economics (AGRICECON) (Oct 2003)
EU enlargement and the Common Agricultural Policy
Abstract
The incorporation of the Central and Eastern European Countries (CEECs) to the common agrarian market of the European Union is an entrance the saturated market solving problems with surpluses of main agricultural commodities. That is why an increasing of competition among both current member states and the new members has been anticipated. The question related to productivity of factors as well as technology level influence on competitiveness on the occasion of lower prices of agricultural commodities that could bring about shift of trade between agricultural enterprises and food processors in the first stage of processing within commodity chain into some of new member countries (or changes within them) and steer flows of some of agricultural commodities utilised as raw materials. The decisive position of the second stage of agricultural products processing, characterised by highly finalised products, probably will push forward the existing member states, especially the main producers and major exporters of finalised food products in Europe. Their interest in generation and expansion of this kind of market with highly finalised food products on the CEECs food markets would be expected. Moreover, the "demand driven agriculture" implying qualitative criteria such as food safety and precaution, favourable method of production, environmental impact etc., presented by agricultural policies in last decade and for future, is largely influenced by final stages of agri-food commodity chains. Distributors and well-established processors are those who "translate" the consumer's demand to agricultural producers. Those decide significantly about the dimension, structure and market share of agricultural production in concrete area in essence. This situation has influenced effectiveness of the Common Agricultural Policy (CAP) exactly. Based upon the last reforms of the CAP in the EU evaluation, the significant changes of commodity markets regulation tools and a new approach partly related to income stabilisation policy partly to support of technological change and restructuring in wider social and regional aspects of the CAP are demonstrated there.
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