The Common Agricultural Policy and EU Enlargement

This study analyses the potential evolution of agricultural income and the viability of selected farming systems in the Czech Republic, Hungary, Latvia, Poland, and Romania under different Common Agricultural Policy (CAP) implementation scenarios. The assessment of the pre-Accession situation (2001-2002) reveals low economic viability and accumulation capacity for most of the farming systems considered. The study finds large negative wage gaps compared to the EU-15 average, as well as large differences among the countries analysed. Post-Accession prospects for agricultural income for the farming systems analysed are examined up to 2013. Three hypothetical policy scenarios are developed, simulating the effects of various policy alternatives on the NI/WU of the farming systems analysed. Overall, the study produces new evidence of a positive impact of the implementation of the 2003 CAP (the Single Farm Payment Scheme only) on agricultural income in selected New Member States/Candidate Countries. It also shows that, in the countries studied, the full removal of policy support at this stage of reform would harm the viability of the farming systems examined. However, targeted redistribution of policy support towards the weaker components of the farming structure would improve agricultural income.