EU farms chief offers hope

The European Union's farm chief this week told the Baltic states they should not expect to extract more subsidies for their farmers when membership talks hit their final lap in coming weeks.

But after meeting with the agriculture ministers of Estonia, Latvia and Estonia, EU Agriculture Commissioner Franz Fischler praised progress by the region's rural economies.

He identified some room for maneuver in other aspects of agricultural policy given the special problems faced by Baltic farmers, who have struggled to adapt since breaking away from the Soviet Union.

"To compare with my last visit two years ago, there is a lot of progress, obvious and visible," Fischler told journalists.

"The room for maneuver for compromises in the negotiating package is limited with regard to the proposal to phase in direct payments," Fischler told a joint news conference with the Baltic ministers, referring to his proposal that farmers in new EU states receive only a quarter of the aid enjoyed by current EU states at first.

It would be 10 years before new members get the same amount.

The proposal first outlined by the European Commission, the EU's executive arm, in January, has caused dismay among many of the 10 countries which are hoping to finalize EU membership talks by the end of the year.

It has fanned concerns that Baltic citizens would vote against membership at referendums expected next year, as evidenced by sharp drops in enthusiasm for accession registered in polls taken after the EU published its plans.

The 15-nation bloc is expected to finalize its negotiating position on the farming issue when its leaders meet in Brussels in October, and Fischler stressed that some EU members were not willing to pay incoming countries any farm subsidies at all.

But he said he would try to deal with another Baltic concern, that farm quotas proposed by the EU would force the Baltic farmers to cut production from current levels, particularly in the traditional core area of Baltic agriculture - dairy farming.

"With regard to the quotas ... I do see some limited flexibility, but only on the basis of solid arguments," he said, adding that Baltic officials had committed themselves to provide more evidence to back their claims by the time of the October negotiations.

"We will propose to take into account the question of the Russian crisis and other anomalies."

At their meeting, farm ministers from the Baltic countries demanded special treatment to account for the particular difficulty of the states' transition from a collective farm system run from Moscow, when the Baltic states had no farming policies or state structures of their own.

The quotas proposed by the EU are unduly low as they are based on how much the Baltics produced in the late 1990s, when exports were hit hard by the Russian economic crisis and a re-orientation of exports to Western Europe and the United States had yet to occur, the Baltic agriculture ministers have argued.

Production in some sectors was lower in the late 1990s than in the 1930s, they say.

Earlier, Fischler was urged to propose more aid for Baltic farmers when he visited a holding in central Latvia.

"The last 10 years have been so hard for us. Twenty-five percent is like dry bread, it's very little," said Vija Cirule after Fischler visited her and her husband's Mezaciruli farm.

But addressing farmers' representatives at an agricultural college in Jelgava, Fischler stressed they should look at the whole package on offer from the EU.

In particular the bloc has already allocated 23 million euros annually to aid rural economies in Latvia alone, under its Special Accession Program for Agricultural and Rural Development (SAPARD), he said.

That money is partly intended to help people move into other kinds of rural enterprise such as tourism, and production of natural remedies and beauty products or organic produce.

Comparatively low wages in the region give the Baltics an advantage over the existing members in labor intensive sectors like organic farming, Fischler pointed out.

But while Cirule's 680 hectares make Mezaciruli one of Latvia's largest farms, owners of some of the country's 170,000 small and medium farms feel neglected by the government's approach to distributing EU funds.

In particular, Latvia only wants farms of 15 hectares or more to be eligible for the EU's direct payments, as opposed to the one hectare proposed by the EU, said Martins Roze, director of EU integration at Latvia's Agriculture Ministry.

"Everything the present ministry is campaigning for is aimed at pulling all subsidies on to very large farms," said Janis Rozentals, chairman of a farmers' association in the western Latvian region of Talsi.