Having examined the proposal for the European Union (EU) long-term budget for the next planning period from 2028 to 2034, published by the European Commission (EC) on the evening of Wednesday 16 July, Minister for Agriculture Armands Krauze believes that Latvia's priority in the next EU planning period is separate, undiminished and clearly structured funding for the EU Common Agricultural Policy and the Common Fisheries Policy.

Minister for Agriculture Armands Krauze: “There is no question about increasing funding for EU defence and security, or for support to Ukraine. However, the EU has ample scope to make savings at the expense of other planned expenditure, such as the excessive implementation of green course requirements, unnecessary measures for the integration and upkeep of unfriendly immigrants, incomprehensible studies and the like. Strong EU funding for agriculture and rural areas will also be needed in the future, because any reduction will have a very negative impact on food production, food prices and the development of rural areas alike. Latvia's farmers need competitive income support, which until now has been unequal, and such a situation must not be allowed in the next period. It is extremely important for Latvia that substantial EU funding for rural development be secured, yet at present no such heading is clearly apparent in the EU budget. Agriculture and food production are core sectors of the EU. That is why the current short-sighted approach is in no way understandable or supportable — giving agricultural support a subordinate role by folding the support funding earmarked for EU agriculture into some sort of centralised national fund, with an unclear amount of funding available to the sector and hence also the risk of being unable to genuinely address the sector's problems and stimulate growth.”

The proposal published by the EC setting out the new EU budget plan envisages including agricultural support in a single centralised fund together with other policies. Moreover, within this single fund the share earmarked for agricultural support across all EU countries combined has been considerably reduced compared with the current period. It is also envisaged that Member States may finance agricultural activities from the remaining unearmarked part of the national fund; however, such a budget model may mean that EU Common Agricultural Policy support for Latvia's farmers is reduced. That is unacceptable.

It is important for Latvia to support agriculture and food production, doing everything possible to strengthen Latvia's competitiveness in fierce market conditions. The EC proposal to replace the direct payments that have hitherto been unfair to Latvia's farmers with a fundamentally altered income support payment is therefore a step with unpredictable consequences, since it may mean a reduction in support. Given that Member States have differing capacities to secure national budget co-financing, the co-financing conditions must be such that they do not distort competitive conditions between Member States.

“To ensure the stability and further development of the agriculture, fisheries and food production sectors, the negotiations on the EU multiannual budget for 2028-2034 must result in agreement among Member States on separate and clearly structured funding for agriculture and fisheries, under which Latvia would have access to funding at least at the level of the current period. The European Commission's initial proposal is thoroughly unclear — it gives no indication of the amount of EU funding that will be available to Latvia in future for the development of the agriculture and food production sectors, or for support to rural areas and investment in modernisation and rural business in order to create a positive socio-economic impact on rural areas. EU funding for rural development in Latvia was already cut without justification in the current planning period, and so any further reduction for these purposes is not and will not be acceptable to us in any way,” Armands Krauze emphasises.

The Minister for Agriculture points out that implementing the Common Fisheries Policy (CFP) likewise requires a clearly separated budget at EU level, because CFP implementation is regulated at EU level — catch quotas are set and strict conditions are laid down for product traceability and fishing controls, which place a considerable additional financial burden on our fisheries sector and on the state budget. Fisheries in Latvia make a significant contribution to the availability of safe and healthy food, and so separate funding at EU level is needed within the CFP implementation process if the sector is to continue to exist competitively.