FAO Activities and Assistance to CEE and CIS Countries

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Rural development and EU accession Lessons
learned
Richard Eberlin Land Tenure and Rural Development
Officer
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Outline

• A new paradigm for rural development
• The evolution of CAP
• Lessons learnt from RD program 2000-2006
• EU support programmes for rural development
• Conclusions and Recommendations for Policy Makers

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A new paradigm for rural development

• factors influencing current rural policy making
• increased focus on natural and cultural amenities
• recognition of the limits of agriculture policy
  and international pressures to reform it
• decentralisation and new trends in regional
  policy
• gt several OECD and non-OECD countries are
  developing a multi-sectoral, place-based approach
  that aims to identify and exploit the varied
  development potential of rural areas
• two principles characterise the new rural
  paradigm
• focus on places instead of sectors
• focus on investments instead of subsidies
• new policy strategies contribute to important
  culture changes with respect to rural policy
• acknowledgement that there are multiple
  objectives in rural policy and that they require
  different approaches according to different
  places and over time
• developing a culture of cross-sectoral
  co-operation at all levels of government
• place-based approach has helped foster
  public-private partnerships and mobilise new
  resources at the local level

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A new paradigm for rural development
Source OECD (2006), OECD Rural Policy Reviews
The New Rural Paradigm Policies and Governance
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The evolution of CAP

• Objective of EU policies reduce economic and
  other disparities between urban and rural areas
• 1964 - Launch of the Common Agricultural Policy
  (CAP) Focus on agriculture support, i.e. Pillar
  I gt farm support through market price policy
  production support
• 1972 - Introduction of Rural Development Funds
  Introduction of limited farm restructuring
  measures and direct compensations introduced for
  farmers in Less Favoured Areas
• 1975 - Creation of Regional Funds Introduction
  of transfers between member states (not regions)
• late 1970s - renewal of private and public
  buildings and infrastructure in villages
• 1988 - Delors I Package Foundation of the
  present budget structure introduction of
  multi-annual financial frameworks and fundamental
  principles of regional funds
• 1992 - Delors II Package Large increase in
  regional funding
• 1992 - MacSharry Reforms of the CAP Introduction
  of direct payment mechanisms phasing out of
  price support reinforcement of rural development
  policies
• emphasis of EU on investment on farms and
  improvements in marketing and processing farm
  products
• limited support to rural development, e.g. rural
  infrastructure, road construction, village
  renewal
• gt only big farms benefit

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The evolution of CAP

• New phase started with the First European
  Conference on Rural Development which took place
  in Cork, Ireland, in November 1996
• gt rural development policy established as
  second pillar of CAP
• 1999 - Agenda 2000 Deepening of the reform of
  the CAP
• 2000 - Lisbon Strategy Focus on growth and
  employment, through innovation
• gt Council Regulation (EC) No 1257/1999 of 17
  May 1999 on support for rural development from
  the European Agricultural Guidance and Guarantee
  Fund (EAGGF)
• The EAGGF comprised two sections the guarantee
  section served as the source of funding for
  agricultural expenditure, and the guidance
  section financed rural development measures

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The evolution of CAP

• 2003 - Mid-term Review of the CAP De facto
  decoupling of direct income support from
  production in the CAP, reforms of agricultural
  markets
• 2005 - Reform of Rural Development Policies
  Widening of scope of rural policies to support
  non-agricultural actors
• 2007 - New EU Financial Perspectives Reform of
  the budget, stronger focus on employment and
  innovation
• 2008 Health Check Further decoupling and
  modulation

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Lessons learnt from RD program 2000-2006

• new rural development policy should accompany
  and complement market and income support policies
  of CAP I
• should consider general objectives for economic
  and social cohesion policy while integrating
  other major policy priorities for competitiveness
  and sustainable development
• reform of CAP in 2003-04 introduced major changes
  which had significant impact on agricultural
  production patterns, land management methods,
  employment and wider social and economic
  conditions in rural areas but increased
  disparities between rural areas in the enlarged
  EU
• gt concentration on priorities to ensure
  sustainable development of rural areas
• gt focus on limited number of core objectives
• agricultural and forestry competitiveness
• land management and environment
• quality of life and diversification of activities
  
• LEADER initiative to mainstream rural development
  programming

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Sapard Experience
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CAP expenditure and CAP reform path
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EU support programs for rural development
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EU support programs for rural development

• After CAP reform 2003
• Pillar I CMOs, direct payments decoupled from
  production, cross compliance
• Pillar II Rural Development
• Funding until 2006 European Agricultural
  Guidance and Guarantee Fund (EAGGF Council
  Regulation (EC) No 1257/1999 of 17 May 1999)
• gt shift from yellow to green box measures
• gt more funds to RD (e.g. diversification of
  rural economy)

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EU support programs for rural development

• Pillar II
• Member countries gt EARDF
• Candidate countries gt IPARD
• Potential candidate countries gt IPA

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EC support programs for rural development

• Member Countries
• European Agricultural Fund for Rural Development
  (EAFRD EU Council Regulation No. 1698/2005 of 20
  September 2005)
• Minimum 25 of CAP for RD (Pillar II)
• New EU Members minimum 40 for RD

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EC support programs for rural development EAFRD
AXIS 3 Quality of life diversification of
activities
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EU support programs New policy framework
For the period 2007-2013 gt 6 instruments to
substitute more than 100 Policy driven
instruments ? Instrument for Pre-Accession
(IPA) ? European Neighborhood Partnership
Instrument (ENPI) ? Development Cooperation
Economic Cooperation Instrument (DCECI) Crises
response instruments ? Humanitarian Aid
Assistance ? Macro-Financial Assistance (MFA) ?
Instrument for Stability
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EU support programs IPA

• Instrument for Pre-accession Assistance
• Integrates Phare, ISPA, SAPARD CARDS
• Five components
• Transition Assistance Institution Building
• Regional Cross-Border Co-operation
• Regional Development
• Human Resources Development
• Rural Development (IPARD)

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EU support programs for rural development IPA

• IPARD Objectives
• Acquis communautaire in CAP
• Sustainable adaptation of agriculture and rural
  areas
• IPARD - Priorities
• Improve market efficiency, quality and health
  standards
• Create new employment in rural areas
• IPARD Plan

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EU support programs IPA

• Transition Assistance
• Institution Building
• 2. Cross-Border Cooperation
• 3. Regional Development
• 4. Human Resources Development
• 5. Rural Development (IPARD)

Annex II Albania, Bosnia and Herzegovina, Monten
egro, and Serbia incl. Kosovo
Annex I Croatia, Turkey FYR of Macedonia
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IPA Policy framework and Programming
Multi-annual Indicative Financial Framework
(MIFF) establishes the financial allocation
between countries and components
Multi-annual Indicative Planning Document (MIPD)
establishes strategies for each country for the
IPA components, based on the priorities set in
the Accession Partnership, NPAA and the Regular
Reports
Components for specific programming
Transition Institution Building
Regional Cross-Border Co-op
Regional Development
Rural Development
Human Resources Development
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EU Assistance for European neighbor countries
European Neighborhood Policy

• Partnership Cooperation Agreement (PCA)
• ENP Action Plans National Indicative Program
  (NIP)
• Current funding 15bn
• European Neighborhood Partnership Instrument
  (ENPI)

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EU Assistance for ENP countries

• Action Plan
• National Indicative Program (NIP)
• TACIS until 2006
• ENPI from 2007
• Sector Wide Approach Program gt e.g. SWAP for
  Agriculture, Food Safety, Rural Development

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EU support programs for rural development

• Other support programmes
• regional development and economic and social
  cohesion policies
• gt see EU Funding in Brief December 2006 Europa
  Media www.europamedia.hu Budapest

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Conclusions Recommendations for Policy Makers
(with accession perspective)

• CAP is a moving target gt dont take the current
  CAP support measures as granted in the future
• starting RD programmes with own resources and
  early, including relevant sector strategies as
  first step that are in line with EU RD policies
• use to the maximum the flexibility of EU
  programmes and adapt to own conditions
• keep RD programmes simple but focused
• delegate to the lowest level possible
  (decentralization) and foster local actors to
  take ownership of strategies (e.g. LEADER)
• build capacities at local level
• enhance participation at local level and
  communication between actors (networks)

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Conclusions Recommendations for Policy Makers
(with accession perspective)

• Development of analytical, strategy, planning and
  legal framework documents at national and local
  level (incl. bylaws and implementation
  regulations) for RD
• RD Strategy or Plan approved by Parliament as
  legal basis for mid-term and long-term, including
  funding provisions from state budget
• establish appropriate institutional structures at
  national and local level (paying agency,
  monitoring and evaluation, etc.)

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Conclusions Recommendations for Policy Makers
(with accession perspective)

• Government to design policies to create enabling
  environment for capacity building at local level
  in order to implement RD policies
• establish, strengthen and promote centralized and
  decentralized structures for RD support (research
  and advisory services local institutions
  NGOs, etc.)
• promote networking of all stakeholders concerned
  with RD (e.g. SWG-RRD, web-platforms, etc.)
• enable and condition beneficiaries to apply for
  and use EU funding through capacity building and
  specific support measures at local level

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Conclusions Recommendations for Policy Makers

• Strengthen link between agriculture and
  non-agriculture through public policies and
  investment
• e.g. road infrastructure to support farm and
  non-farm economic activity
• e.g. business regulatory environment to support
  the rural non-farm economic sector
• holistic approaches to rural development
• support to education and RD
• create jobs
• policies, regulations, infrastructure
• finance, business/management/ technical skills,
  market information and linkages
• productive use of remittances
• reinvesting into economic activities

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• Thank you for attention