EC reform will cut food prices

FOOD PRICES will come down speedily as a result of European Community farm policy reforms, the EC's agriculture chief said yesterday. The Agriculture Commissioner Ray MacSharry, speaking in Inverness at a conference on Europe's rural future, said he would be surprised if prices had not come down 'within one year'.

Although the EC's council of ministers still has to ratify, probably without difficulty, the work of the Commission, Mr MacSharry's optimism, whether based on intuition or hard data, will have temporarily disarmed some Euro-critics. Sceptics have maintained that Common Agricultural Policy reforms announced in May - essentially a shift to subsidies that support people rather than prices - were unlikely to yield any immediate results. The EC subsidy paid to European farmers in 1990 amounted to pounds 46bn, with analysts forecasting the level will rise in the short term before the reforms take effect.

However, should the reforms cut even some prices within a year - rather than the anticipated wait of three years or more - there would be a momentum to re- explore some of the more radical MacSharry proposals that were dropped to win agreement. Regardless, he seemed pleased to announce that the CAP changes would result in European agriculture becoming more competitive, and that those farmers poorly placed to cope with the effects of the changes would have their livelihoods maintained.

With the Uruguay round of the Gatt (world trade) discussions unresolved, Mr MacSharry could not resist showing his pleasure that the EC had established a principle it wanted followed. 'We've done our bit,' he said.

The Inverness conference, entitled 'New Beginnings', is also concerned with the environmental impact of the new Europe, an area which the commissioner said had never received the 'priority it should have been given'.