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Introduction
In Luxembourg, in the early morning of 26 June 2003, after having twice suspended its sitting over the preceding 2 weeks, the European Union's Council of Agricultural Ministers reached agreement on a new reform to the common agricultural policy (CAP). The EU's Farm Commissioner, Franz Fischler, had formally launched the reform debate in July 2002 when the Commission had tabled its long awaited mid-term review (MTR) of the Agenda 2000 reforms agreed in March 1999. Between July 2002 and June 2003, the EU had agreed a budgetary framework for CAP spending through to 2013 (at the Brussels meeting of the European Council in October 2002), and to the accession of ten new Member States in May 2004 (Copenhagen in December 2002). In the international arena, the new round of multilateral trade negotiations launched in Doha in November 2001 (the so-called Doha Development Agenda ), of which the agriculture dossier formed an important part, had not progressed as well as some enthusiasts had hoped.
The centrepiece of the newly reformed CAP is a further decoupling of direct payments to create the partially decoupled Single Payment Scheme (SPS).2 Viewed over time, it is clear that the CAP has evolved. In the MacSharry reforms of 1992, for key commodities, there was a considerable shift from market price support to direct aid payments based on the area farmed and livestock kept. These changes were deepened in the Agenda 2000 reforms of 1999 when intervention prices were further lowered and direct aid payments raised. In the Fischler reforms, the link with production of agricultural products was further weakened.
External constraints imposed by the Uruguay Round of international trade negotiations defined an important part of the context within which the MacSharry reforms of 1992 had been discussed. During the first 4 years of the round, farm trade had become a key issue. The main opponents, the EU and the US, had severe difficulties in reaching agreement on reductions in agricultural support and protection. A breakdown in the GATT Ministerial Conference in Heysel, Brussels, in December 1990, at which the round was to be concluded, brought negotiations to a temporary halt, and it was not until the EU had reformed the CAP that an agreement between the two major trading...