Considerations on COM(2000)791-2 - Specific measures for certain agricultural products for the Azores and Madeira - Main contents
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| dossier | COM(2000)791-2 - Specific measures for certain agricultural products for the Azores and Madeira. |
|---|---|
| document | COM(2000)791  |
| date | June 28, 2001 |
(2) The particular geographical situation of Madeira and the Azores imposes additional transport costs in supplying essential products for human consumption, for processing and as agricultural inputs. In addition, objective factors arising as a result of insularity impose further constraints on economic operators and producers in these islands that severely handicap their activities. These handicaps can be alleviated by lowering the price of these essential products. It is therefore appropriate to introduce specific supply arrangements to guarantee supply to these islands and compensate for the additional costs arising from their remoteness, insularity and outermost location.
(3) To that end, notwithstanding Article 23 of the Treaty, imports of the products concerned from third countries should be exempt from the applicable import duties. To take account of their origin and the customs treatment accorded to them under the Community provisions, products which have entered the Community's customs territory under inward processing or customs warehousing arrangements should be considered as direct imports, for the purpose of granting the benefits of the specific supply arrangements.
(4) In order to achieve the goal of lowering prices in these regions and mitigating the additional costs of their remoteness, insularity and outermost location while maintaining the competitiveness of Community products, aid should be granted for the supply to the islands of products of Community origin. Such aid should take account of the additional cost of transport to Madeira and the Azores and the prices applied to exports to third countries and, in the case of agricultural inputs and products intended for processing, the additional costs of insularity and outermost location.
(5) Since the quantities covered by the specific supply arrangements are limited to the supply requirements of these regions, those arrangements do not impair the proper functioning of the internal market. In addition, the economic advantages of the specific supply arrangements should not provoke deflections of trade in the products concerned. Re-dispatching or re-exportation of those products from the Azores and Madeira should therefore be prohibited. However, this prohibition does not apply to trade flows between the regions of Madeira and the Azores. Nor does it apply, where processing is concerned, subject to certain conditions, to exports to third countries to promote regional trade or to traditional consignments to the rest of the Community.
(6) The economic advantages of the specific supply arrangements should be passed on so as to reduce production costs and bring down prices throughout the production and distribution chain to the end user, culminating in lower consumer prices. They should therefore be granted only on condition that they are actually passed on, and monitoring must be carried out to that end.
(7) The area aid scheme for fruit and edible vegetables, roots and tubers, flowers and live plants has proved unsuitable, especially because of the slowness and complexity of procedures and the way the proposed aid was structured. Lessons should be learned from the encouraging results of the Poseidom reform in that sector, and marketing and processing aid should be envisaged with a view to supplying the market in Madeira and the Azores. Such aid should help local produce compete with products from elsewhere on high-growth markets, better satisfy the requirements of consumers and new distribution channels, improve the productivity of farms and upgrade the quality of products. The marketing of these products, both fresh and processed, should be continued and they should be promoted on the Community market. An economic study of each region will help to refine the structure of the sector in these two regions.
(8) It is essential, for both economic and environmental reasons, to keep vines, the most widespread crop, on Madeira. In order to help support domestic production, a flat-rate area aid is granted for the cultivation of vines for producing quality wines produced in specified regions. That aid also applies in the Azores.
(9) Likewise, market regulation mechanisms and abandonment premiums do not apply in these two regions.
(10) Agricultural producers in the Azores and Madeira should be encouraged to supply quality products and the marketing of these should be assisted. Using the Community's graphic symbol might help achieve this.
(11) Traditional livestock farming activities should be supported in Madeira in order to help meet local consumption needs. To that end, derogations are needed from some of the provisions of the common market organisations which restrict production, to take account of the development and particular conditions of local production, which are quite different from those in the rest of the Community. This objective may also be pursued indirectly by financing genetic improvement programmes involving the purchase of pure-bred breeding animals, by purchasing commercial breeds more suited to local conditions and by supplementing the suckler cow premium and the slaughter premium, and, pending the development of local livestock farming, temporary provision should be made for the supply of male animals for fattening, the number of such animals to be supplied each year being limited so as not to compromise the abovementioned objective. The estimate of local consumption requirements is drawn up in a periodic balance. To ensure that Community support can be mobilised effectively, a comprehensive programme to support local activities in the livestock and milk products sectors should enable the sectors concerned to define and implement strategies tailored to the local context for economic development, spatial organisation of production and increasing the professionalism of producers.
(12) In Madeira, aid for human consumption of fresh cow's milk products is paid to the dairies. This aid has not succeeded in maintaining the balance between domestic and external supply, chiefly because of the serious structural difficulties affecting the sector and its poor capacity to adapt to new economic environments. Consequently, it is planned to direct this aid, in the context of a supply balance, towards the collection of local production linked with an authorisation to produce reconstituted UHT milk from milk powder of Community origin, with a view to covering local consumption more fully.
(13) The need to maintain local production by way of incentives justifies not applying Regulation (EEC) No 3950/92(3). This exemption should be established within the limit of 4000 tonnes, corresponding to the current production of 2000 tonnes and to a reasonable possibility of increased production estimated at present at a maximum of 2000 tonnes.
(14) Potato production is essential in Madeira, for both economic and social and environmental reasons. The small size of farms and the cost of inputs make for very high production costs. Specific aid is granted for growing potatoes for human consumption in order to support domestic production to satisfy the islands' consumption patterns.
(15) The aid for the cane-sugar-rum sector in Madeira is granted to support local production of the sugar cane needed to manufacture the products processed from it, within the limits of the requirements arising from the methods traditionally used in the region.
(16) Liqueur wines should continue to be prepared using traditional methods in the islands by facilitating the purchase of concentrated musts and wine alcohol produced in the rest of the Community and by granting aid for the ageing of such wines. To assist the efforts made to maintain the quality and authenticity of these products, aid should be granted for marketing them.
(17) Aid should be granted in Madeira for the production of wicker, which is important as a supplement to farming and provides a livelihood for family craft businesses in the most disadvantaged areas of the islands.
(18) Technical and socio-economic difficulties have prevented the full conversion, on time, of areas planted with hybrid vine varieties prohibited by the common organisation of the market in wine. The wine produced by such vineyards is intended solely for traditional local consumption; additional time will allow such vineyards to be converted while preserving a regional economic fabric very heavily reliant upon wine-growing. Portugal should notify the Commission, each year, of the progress made in converting the areas concerned.
(19) Milk production and cattle farming are the mainstay of the agricultural economy of the Azores, and support for the sector should take account of the crucial importance of these activities in both social and economic terms, especially for small farmers. To ensure the survival of traditional activity in this sector, the suckler cow premium and the aid for dairy cows should continue to be supplemented, within the limit of the available local quota. A supplement to the slaughter premium should be introduced and aid granted for the disposal of surplus male bovines for which no normal outlets can be found in the islands and which must be shipped to the rest of the Community at considerable additional cost, given the particular geographical situation of the region. To ensure that Community support can be mobilised effectively, a comprehensive programme to support local activities in the livestock and milk products sectors should enable the sectors concerned to define and implement strategies tailored to the local context for economic development, spatial organisation of production and increasing the professionalism of producers.
(20) Agricultural activity in the Azores is highly dependent on milk production. This dependence, combined with other handicaps linked to their outermost location and the absence of viable alternative production, is detrimental to their economic development. The needs of local consumption in those islands covered by local production should be taken into account and some of the provisions of the common market organisation for milk and milk products on limiting output should be derogated from for a period of four marketing years beginning in 1999/2000 in order to take account of the level of development of and the conditions for local production. Although this measure derogates from the second subparagraph of Article 34(2) of the Treaty, it is restricted to milk producers in the Azores and is of marginal economic impact when compared with the total quota for Portugal. It should enable the sector in the Azores to continue being restructured over the period of application of this measure without interfering with the milk market and without appreciably affecting the sound working of the levy scheme at Portuguese or Community level.
(21) With regard to crop cultivation in the Azores, the small cultivatable area, the small size and fragmentation of farms and the extensive nature of production all make for high production costs. It is vital that these crops (beet, chicory, potatoes, tobacco, pineapples, wine, tea, etc.) continue to be cultivated as an alternative to counterbalance the predominance of livestock farming, and to ensure this the aid granted to the local processing industry should be continued.
(22) Furthermore, the making of liqueur wines in the Azores by traditional methods should be continued, by granting aid for the ageing of 'verdelho' wine.
(23) The plant health of agricultural crops in Madeira is subject to particular problems associated with the climate and the inadequacy of the control measures hitherto applied there. Programmes should be implemented to combat harmful organisms including by organic methods. The Community's financial contribution towards such programmes should be specified.
(24) Regulation (EC) No 1257/1999(4) lays down rural development measures that may be granted Community support and sets out the conditions for obtaining such support.
(25) This Regulation seeks to remedy the handicaps due to the remote and insular nature of these regions.
(26) The structures of certain agricultural holdings or processing and marketing enterprises located in these regions show serious shortcomings and are beset with specific difficulties. Provision should accordingly be made for derogations for certain types of investments from the provisions limiting or preventing the grant of some structural aid provided for in Regulation (EC) No 1257/1999.
(27) Article 29(3) of Regulation (EC) No 1257/1999 restricts the grant of forestry support to forests and wooded areas belonging to private owners and municipalities and associations thereof. Part of the forests and wooded areas located in these regions belong to public authorities other than municipalities. Under these circumstances, the conditions laid down in the said Article should be made more flexible.
(28) The Community financial contribution for three of the accompanying measures referred to in Article 35(1) of Regulation (EC) No 1257/1999 may amount in the outermost regions to up to 85 % of the total eligible cost. On the other hand, in accordance with the third indent of the second subparagraph of Article 47(2) of Regulation (EC) No 1257/1999, the Community financial contribution for agri-environmental measures, which constitutes the fourth accompanying measure, should be limited to 75 % for all areas covered by Objective 1. In view of the importance attributed to agri-environment within the context of rural development, the rate of the Community financial contribution should be harmonised for all accompanying measures in the outermost regions.
(29) Article 24(2) of Regulation (EC) No 1257/1999 and the Annex thereto determine the maximum amounts per year eligible for Community agri-environmental aid. To take into account the specific environmental situation of certain very sensitive pasture areas in the Azores and the preservation of the landscape and traditional features of agricultural land, in particular the areas of terrace cultivation in Madeira, provision should be made for the possibility, in the case of certain specific measures, of increasing those amounts up to twofold.
(30) Pursuant to Article 14 of Regulation (EC) No 1260/1999(5), each plan, Community support framework, operational programme and single programming document should cover a period of seven years, and the programming period should begin on 1 January 2000. In the interests of cohesiveness and to avoid discrimination between beneficiaries of the same programme, the derogations provided for in this Regulation should, exceptionally, be applicable to the whole programming period.
(31) A derogation may be granted from the Commission's consistent policy of not authorising State operating aid for the production, processing and marketing of agricultural products covered by Annex I to the Treaty in order to mitigate the specific constraints on farming in the Azores and Madeira as a result of their remoteness, insularity and outermost location, small area, mountainous terrain, climate and their economic dependency on a small number of products.
(32) The measures necessary for the implementation of this Regulation should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission(6).