Why oppose EU subsidies for farmers

And what benefits do EU farmers receive from their governments?

Nearly half of the budget is spent on agricultural subsidies

It's never easy to figure out exactly how much European farmers get from their governments. On the one hand, this is because the agricultural system in the EU is very different from that in China. The EU countries are practicing "*** with the agricultural policy", mainly through the "price support" to subsidize farmers, and this set of price system is extremely complex, the price level of each product varies from year to year, and thus the level of subsidies is also different. Specifically, the EU directly determine the price of crops are divided into cereals, rice, vegetables, fruits, sugar, alcohol, tobacco, milk, meat, eggs, vegetable oils, animal fats and oilseeds and other 13 categories, accounting for about 96% of the agricultural products produced by the EU. Each year, the Directorate General of Agriculture of the European Union determines the corresponding "intervention prices" and "target prices" according to the production and marketing situation of the year, and is approved by the Council of Ministers of Agriculture of the European Union and published.

On the other hand, the EU's subsidies to farmers are in various forms, with a wide range of names, especially many non-cash forms of subsidies. To the EU *** with the Agricultural Fund, for example, this part of the expenditure in addition to the main agricultural intervention in the purchase of the "guaranteed part", there is the so-called "guidance part", mainly for the improvement of production facilities (such as land improvement works, water conservancy and irrigation works, afforestation works, etc.), improve the marketing of agricultural products works The main purpose is to improve production facilities (such as land improvement projects, water conservancy and irrigation projects, afforestation projects, etc.), improve the marketing of agricultural products engineering facilities (such as the construction of grain silos, farmers' markets, etc.), the reform of the production structure, as well as the training of agricultural technicians.

The level of subsidies for individual farmers is difficult to calculate, so let's look at the total. Agriculture currently accounts for only 1.8% of the EU's GDP, and the agricultural labor force accounts for only 3% of the total labor force, but the proportion of agricultural funds in the EU***s same fiscal budget has stabilized at nearly half the level of more than 40 billion euros per year.

Countries and according to their own situation to develop a unique support measures

Although the EU countries will be the formulation of agricultural policy to the *** with the body level, but "still think the EU is not enough for their farmers to consider", and therefore according to their own situation, accordingly, the development of a unique agricultural support measures. The first step is to make sure that you have the best possible support for the farmers in your country.

Take taxation as an example.

Taking tax as an example, there is no agricultural tax in all EU countries. Farmers, like other members of society, pay personal income tax, corporate income tax, property tax and so on according to the attributes of their economic activities. Agricultural products are subject to value-added tax (VAT) in the same way as industrial goods. However, unlike the general industrial VAT, which is mostly within 20%, countries have adopted special preferential policies for agricultural products, or completely exempted certain agricultural products, or the implementation of a special tax rate, which makes the actual tax rate of agricultural products greatly reduced, such as the average of 7% in France, Germany 6.5%, Italy 2%, Luxembourg 5%, the Netherlands 4%, Austria and Belgium for 6%.

In addition to tax policy, countries have their own agricultural support measures. France is a large agricultural country in the EU, its financial subsidy policy is very distinctive. Financial subsidies and agricultural credit closely integrated, from 1990, the French government each year to organize the various banks for subsidized loan interest rate bidding, who has the lowest interest rate, who will be eligible for the issuance of subsidized loans. Subsidized loans are mainly used to support young people to enter the agricultural, farm modernization and transformation, the use of agricultural machinery cooperatives, the loan period of up to 15-18 years.

The Dutch government, on the other hand, guides and stimulates investment in agriculture by means of "joint investment between the government and farmers". Want to get the government policy investment in farmers, you can make investment plans to apply to the government, the scope includes agriculture, agricultural products processing industry and animal husbandry, etc.. After review and approval, the government may make joint investments with farmers. The proportion of government investment generally accounts for about 40% of the total investment.

In addition, due to the EU *** with the agricultural policy is mainly involved in the market policy part of the development of rural areas, still belongs to the responsibility of national governments. In formulating policies for the development of rural areas, countries generally focus on investment in land reorganization, soil and water conservation and environmental protection, which has played a positive role in narrowing the gap between urban and rural areas and promoting balanced regional development.

However, the EU's overprotection of farmers has also created a heavy financial burden for itself. Many member states, such as Germany and the Netherlands, have called for a high level of reform of agricultural policy. In recent years, the EU has also repeatedly reformed its agricultural subsidy policy. But because the EU's agricultural reform involves the interests of all member states, farmers and consumers to adjust, its difficulty can be imagined.

More than 90% of farmers joined one or several cooperatives

Although most of the small farmers in the EU countries are decentralized, a large number of industrial organizations have been developed. The reason is very simple, in the face of the ruthless market and other interest groups, the power of individual farmers is extremely small, only united, can produce scale effects, to protect their own interests.

France and the Netherlands developed agriculture, agricultural products, second only to the United States in terms of annual exports, the form of its diverse, well-organized agricultural cooperative model is also breathtaking. France has more than 6,000 cooperatives, more than 90% of farmers joined one or several cooperatives. The system of French agricultural cooperatives is very perfect, in various industries, regional cooperatives on the basis of cross-regional cooperatives, and even national cooperative associations.

The French and Dutch agricultural cooperatives are very diverse and operate in a wide range of fields. It can be said that cooperatives are involved in any area where farmers have a need. Roughly speaking, there are the following three areas of activity of cooperatives: First, the processing and circulation of agricultural products, including the purchase and sale of agricultural products and the supply of production materials. For example, cooperatives provide farmers with agricultural materials such as fodder, fertilizers and farm machinery to reduce farmers' costs. Farmers sell their agricultural products to cooperatives, which then process and sell them. After the cooperative sells them, it returns most of the profit from them in proportion to the share of raw materials provided by the farmers. This will not only avoid letting farmers bear the market risk alone, but also increase farmers' income.

Second, the field of agricultural services. Various types of professional cooperatives have formed a scientific and strict rural socialized service system, such as seed identification, product testing, storage and technical training. In France, there are even artificial insemination cooperatives, which provide artificial insemination for livestock in accordance with the strict standards set by the state for the selection of good animal breeds.

Third, the field of agricultural finance. France and the Netherlands are both very developed rural cooperative finance, France has various forms of credit cooperatives, including the French Agricultural Credit Bank is the largest bank in France, 90% of farmers are customers of the Agricultural Bank. The Dutch Cooperative Bank has a 90% market share in the Dutch agricultural credit market, and farmers who participate in this credit bank can get loan preferences that are 0.5 percentage points below the ordinary interest rate.

It can be said that cooperatives have changed the weak position of individual farmers, so that farmers not only get the value-added benefits of agricultural products, but also get the benefits of scale, and can share the profits of agricultural products processing, warehousing, transportation and sales of all aspects of the profits, and effectively improve the income of farmers.

It is worth mentioning that the various forms of farmers' organizations in the EU, are farmers in a completely voluntary basis to participate in, and by the farmers self-management of mutual assistance and mutual benefit of the civil economy organizations. At the same time, the government provides strong support and protection for these organizations, including legal support, tax incentives and credit support. The government recognizes the status of these farmers' organizations as advocates of farmers' interests, and actively consults and communicates with these organizations when formulating policies related to farmers, rural areas and agriculture, so as to reduce misunderstandings and contradictions between the government and farmers, and to ****together promote the development of agriculture and the prosperity of rural areas.

The United States said that the European Union spends 50 percent of its entire budget on subsidies to give European Union farmers, who make up only 2 percent of the European Union's total population, an advantage in foreign markets. Four countries - Germany, France, Britain and Austria - have slammed the EU's program to reform government subsidy principles. They argued that the program, which is sponsored by the EU Commissioner for Competition, Ms. Nellie Kroesch. They believe that the reform of the principle of government subsidies, chaired by the EU Commissioner for Competition, Ms. Nellie Kroesch, will cause many problems, such as increased unemployment and the relocation of companies.