AGRYA - Agricultural and Rural Youth Association, Hungary wants to provide agricultural journalists with credible and useful information with its two-part programme.
On 27 May 2011, media representatives had a chance to get to know their chosen field on site, during a farm visit, so this time, they experienced what agriculture really is about from first-hand experience, not behind a desk or sitting in a press conference.
”The peculiarity of journalist work is that they are overwhelmed, they don't have time to dig deep into a topic, but if they could get direct, first-hand information, they can give appropriate and exact information” – justified Lajos Mikula why the programme is needed. The journalists could glimpse into the work of a young farmer in the farms of fruit grower Roland Szakács, shepherd Gábor Pál and cow-breeder Ottó Szakál, who also grows crop besides stock breeding, so his farm is self-suppliant in that matter.
The second part of the programme was held at 9 December 2011. Then, journalists were provided with theoretical knowledge to complement the practical experiences. The workers of the Research Institute of Agricultural Economics, Budapest (AKI) were helping in this.
As an introduction, representatives of the media had a chance to gain knowledge of the European Union's Common Agricultural Policy (CAP). Dr. Gergely Papp, worker of the institute's Department of Agropolitical Research told in his presentation – among other things – that originally, CAP wanted to realise a single internal market, where prices are high. But to maintain this, this internal market was separated from the world market by import levies and duties. Although this way, CAP provided protection from the processes of the world and maintained a stable source of income for farmers, but this is (one of the) source(s) of why it is the subject of heavy criticism. Maintaining such a system was quite expensive that lead to internal pressure, while the measures were really poking the eye world trade partners, so CAP was under pressure from two sides.
In order not to let the double pressure – which became almost unbearable by the 1970 – to “explosion”, reform was necessary. After the unsure steps of the 1980s, the first “real” wave started in 1992, followed by newer and newer ones to slowly transform CAK, that gradually got accustomed to the circumstances. The subsidies connected to the amount of production were rolled back in order not to encourage over-production detached from real needs, and the decoupling process started, the outcome of which was that the so-called direct payments became dominant. These are practically subsidies gave indifferently to the amount of production, where everyone gets the same amount per hectare – at least, if they are from the same country, since states being members only after 2004 started at lower levels, although Hungary is really close to the EU average by now.
Dr. Csaba Pesti from the Department of Entrepreneurial Analysis studied the European Union's Multiannual Financial Framework. The European Commission published its proposal on 29 June 2011, that determines for the next seven years the size of the slice for CAP from the EU budget. According to this, the expenditures of the policy would be nominally frozen, threfore, the total CAP-budget would be 387 billion Euros. As a part of this, 282 would be for the I. pillar (direct subsidies, market measures), while 90 billion Euros for the II. pillar (edit structural adjustments, rural development, measures for environment protection). The expenditure of CAP would not be reduced as a whole, but its value and share from the total EU budget (from 39 to 36 percent) would.
Hungary is among the states that would get the same amount from the I. pillar after dividing the money between member states than before, since it gets more than 90 percent and less than 100 percent of the EU average. Those who are above this zone would get proportionally less money to finance the rise of those who are below 90 percent, since they could expect an extra one-third of the difference between their current level and the 90 percent.
According to Dr. Csaba Pesti, taking into regard the original expectations and fears, the CPA-proposals are broadly acceptable for Hungary, it will not shake our position as net beneficiaries – although, sadly, it will not improve either.
Although the proposal does not pose any problems to Hungary, this is not true to every member state, revealed the presentation of Dr. Levente Nyárs from AKI's Department of Agropolitical Research. The Germans for example – contrary to the French or Irish hoping for status quo – would have reduced the amount of I. pillar expenditure, and the United Kingdom would have marginalised them if it had the chance to do so.
The researcher introduced the member states' fight for positions since the Paris Declaration in 2009, when 22 countries – including Hungary – made a stand on the side of a strong CAP, through the French-German declaration of September 2010 (which voiced their disapproval of CAP's reduction and the renationalisation of agricultural policy) to the biggest alliances and the opinions about certain questions. Although Hungary is in a good position, since – although its population and agriculture is just two percent of the EU's – 2,5 percent of CAP's expenses are directed to Hungary, but this could also be the source of threat. Nevertheless, it can be encouraging that – thanks to EU's working and decision-making mechanism – we can have a bigger role than our real weight in forming CAP.
After the near future, Kamilla Kesjár took participants to the near past, the implementation of CAP in Hungary. She showed that expenditure fell from 2009 to 2010 – both the amount of national and EU money. But the reason for this is – beyond some smaller factors – was the one-time subsidy for sugar producers, and it was higher than in 2008 or before. Direct paymets jumped from the previous levels of approximately 430 billion Forints to 630 in 2009, and than fell back to around 530 billion. The trend was similar in the case of rural development subsidies: in 2010, 175,2 billion forints were granted after 191 billion a year before, but it must be noted that 2009 doubled the amount that was typical before.
Dr. Erika Székely (AKI, Department of Rural Policy Studies) presented rural development in CAP. She emphasised that CAP is mainly about supporting agriculture, although rural development was promoted between 2000-2006, and it is also among the goals declared since 2007. As conclusions, she made several statements. From the perspective of new EU countries, rural development is basically a success story, but most of the subsidies land at the biggest, most active and most successful producers, communities, which was not really helpful for smaller farms. In underdeveloped rural regions, agriculture is still the only chance for employment, for making a living. In this regard, of course, CAP-subsidies serve more of a social goal than development.
Acces to subsidies are often denied by the lack of proper knowledge and/our own financial resources, and the complex system of rural development measures are basically tailored to wealthier member states, while it is in many ways inappropriate for newly joined states.
Dr. Szabolcs Bíró (AKI, Department of Rural Policy Studies) introduced EU's and Hungary's land policy. He told that the improvement of SMEs' and big enterprises' competitiveness is still an issue, and should be done to possibly avoid the big plantation system that only focuses on production of goods and not on common goods, because the number of small estates is reducing with the retirement of older farmers although they are still dominant. Therefore, the Hungarian estate system is quite diverse, dual.
Dr. Anikó Juhász (AKI, Department of Food Chain Analysis) introduced the role of quality in the EU's food supply chain. She highlighted that the question is really timely, since the seemingly unstoppable spread of quality systems in number and scope will continue, or will even turn to the opposite – according to the researcher, there are signs for both. However, in Hungary, the view is getting more and more fashionable after the fall of Communism that not only considers the price but also the quality of a product while buying.
After quality, innovation's role was presented by Dr. Gyöngyi Jankuné Kürthy (AKI, Department of Food Chain Studies). In Hungary – mostly because of the costs – companies are not really fans of innovation and research, and the presence of multinational corporations with a lot of capital is not helping either, since the innovation itself is completed abroad, here, the product is only made according to that. But strong innovation could not be a successful strategy in itself, only combined with proper marketing, warned the researcher. According to her, innovation in the food industry is still not in its “struggling” state in the EU, but there are some warning signs that must be noted.
All in all, the journalists took part in a useful programme, that helped them to get a comprehensive picture about agriculture: the presentations not only covered the broad scale of theoretical questions, but media workers also gained real practical experience about agriculture, so they can depict it more clearly in the future during farm visits.
After the workshop Krisztina Gönczi, editor of Profit Agro Magazine said that plant cultivation is more profitable today, as it could be seen in the examples set by the farmers. She even compared animal husbandry to “filling very expensive wheat to very cheap skin”, and farmers need to produce fodder for themselves to survive.
Péter Bedő, journalist for Hungarian Agriculture shared this opinion: land is one of the most stable sources of income, and means times, the only way, while animal husbandry is a lot more difficult.
