Agricultural liberalization in the European Union: An analysis of the implications for nature conservation

The liberalization of agricultural policy is a more realistic prospect today than ever before. Following the Uruguay Round Agriculture Agreement of 1993. European policymakers are committed, at least at the level of rhetoric, to the further progressive decoupling of agricultural support in order to increase the exposure of Europe's farmers to world markets. There are compelling reasons to believe that, by the turn of the century, policymakers will come under mounting pressure to further liberalize the CAP. The environmental implications of this policy shift are profound. According to some commentators, the rural environment stands to benefit from a double dividend: once when the reduction in prices brings about an extensification of production, and again when resources previously committed to price support are reinvested in agri-environmental schemes. This paper considers the validity of this important idea. It examines the assumptions behind the extensification effect and discusses the willingness and ability of policy-makers to plough substantial sums of public money into fully decoupled agri-environmental programmes. The paper suggests that the first round effects of a withdrawal of support may not be unambiguously good for the European countryside, while the 'green recoupling' of support could prove more complicated politically than is often assumed. (C) 1998 Elsevier Science Ltd. All rights reserved.