EU to propose helping poor countries with farm aid surpluses

(BRUSSELS) - The European Commission will propose next Tuesday to tap unspent money in the European Union's agriculture budget to help farmers in poor countries, the EU agriculture commissioner said on Thursday.

"Agriculture, when we talk of development aid, has been underprioritized for now more than 20 years, we need to catch up with it," Mariann Fischer Boel told a conference in Brussels.

"We will come forward ... with a package to make it possible for the net food importing developing countries to get money for seeds and fertilizers, to improve their own production facilities," she added.

The Danish commissioner explained later in a press conference that the iniative would be funded by using surpluses in the EU's common agriculture policy.

The CAP's finances are currently brimming with surpluses because high prices for food products has made it unnecessary for the EU to ensure minimum prices through buying up excess supplies.

Fischer Boel said that the funds would come from CAP expected surpluses in 2008 and 2009, but she refused to say how much money would be involved.

One EU official told AFP that the money could range from 750 million to one billion euros.

However, the proposal could face resistance from member states who would normally get such surplus. The idea met with little enthusiasm from member states when Fischer Boel first floated it in May.

"It's a new and important idea which should be studied and debated," said French Farm Minister Michel Barnier, whose country holds the EU's rotating presidency.

"When we have to deal with an exceptional situation, beyond words, exceptional responses are needed," he said.

However, he also stressed that despite a willingness by governments to take action, they had other "constraints" such as "reducing our deficit."

Budget ministers and the European Parliament will have to give their backing for the idea to go ahead, an EU official said.

Some EU governments are also reluctant to use the unspent farm funds for other projects out of fear of creating a precedent.

Already last year 1.6 billion euros in unspent farm aid was used to finance the EU's long struggling Galileo satellite navigation programme, to the consternation of some member countries.

EU Development Commissioner Louis Michel expressed hope that EU governments would not take a "budgetary approach" and would respond to the real needs of development.

"If member states don't give the money, then they won't have any credibility," said Alexander Woolcombe at Oxfam, a pro-development non-governmetal organisation.

London, a long-time CAP critic, and some pro-development NGOs argue that generous EU handouts to farmers have contributed to the current food price crisis by skewing the global market for farm products against poor countries.