Hopes of liberalising world agricultural trade could be hampered at the World Trade Organisation talks unless the EU commits to urgent and far-reaching reform of the Common Agricultural Policy (CAP), according to a new report.

 The House of Lords report on the external implications of the mid-term review of the Common Agricultural Policy focuses on the WTO talks,  developing countries, EU enlargement and sustainability.

Lord Selborne, who chaired the inquiry, said:

"The complacent attitude of some Member States to the crippling effects of the Common Agricultural Policy on developing countries is deplorable.

"The Commission makes a lot of noise about its commitment to fairer international trade yet its current proposals for CAP reform won't assist progress at the WTO trade liberalisation talks.

"The EU spends around £18.5bn a year on direct subsidies to European farmers − twelve times what it spends on aid to poor developing countries.  The costs of CAP are wholly unsustainable and must be urgently reformed ahead of EU enlargement when ten new countries join in 2004." 

The Committee:

  • Endorse the EU Commission's proposal for breaking the link by "decoupling" subsidies from production;

  • Urge the EU Commission to urgently consider formulating proposals for the reform of the markets for dairy and sugar.


1. The members of European Union Sub-Committee D (Environment, Agriculture, Public Health and Consumer Protection) which conducted this inquiry were:

Baroness Billingham

Lord Carter

Lord Crickhowell

Lord Fyfe of Fairfield

Lord Haskins

Lord Lewis of Newnham

Lord Livsey of Talgarth

Baroness Maddock

The Countess of Mar

Lord Palmer

Lord Renton of Mount Harry

The Earl of Selborne (Chairman)

Lord Walpole

2. The report is published by the Stationery Office: Mid-Term Review of the Common Agricultural Policy: External Implications, House of Lords Select Committee on the European Union, 10th Report, Session 200203, HL Paper 62, ISBN 0 10 400165 8, £16.50. The full text of the report will be available on the internet via shortly after publication.

3. The basis of the Committee's inquiry was 10879/02 Communication of 10 July 2002 from the Commission to the Council and the European Parliament on the mid-term review of the common agricultural policy (COM (2002) 394) and COM (03)23 Legislative proposals of 21 January 2003.

4. The Common Agricultural Policy was introduced in 1962 to respond to a strategic need for food security in Europe.

5. The 145 WTO members are due to agree a "modalities" paper by 31 March 2003. When agreed, the paper will form the basis of the next round of global trade talks at the Fifth Ministerial WTO Conference in Cancºn, Mexico in September 2003.

Further information and interviews with the Chairman from:

    Tom Radice

    Clerk of the Committee, on 020 7219 6084

    Jillian Bailey

    Press and Publicity Officer (Committees), on 020 7219 8659