AN UPDATE FROM OUR BRUSSELS OFFICE 1st APRIL

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AN UPDATE FROM OUR BRUSSELS OFFICE 1st APRIL
01 Apr 2020

AN UPDATE FROM OUR BRUSSELS OFFICE 1st APRIL

Brussels, COVID-19

There are 13,964 cases of COVID-19 in Belgium with 828 deaths reported to date (01.04).

Government confinement measures are in place until April 19th with an option to extend to May 3rd.

Ms. Sophie Wilmès, Belgium’s first female Prime Minister, is leading the country in a caretaker capacity since October, following last year’s inconclusive election. She has been given emergency powers for 6 months in relation to the COVID 19 crisis

Brussels streets are quiet with public transport operational but mostly empty. All shops, bars and restaurants are closed with the exception of food shops and pharmacies.

All of the Institutions including the European Commission and the European Parliament are closed and staff are working remotely. The College of Commissioners met Wednesday 1st April via Video Conference

European Commission

The EU executive is to announce the Coronavirus Response Investment initiative Plus(CRII+) package. This will involve greater flexibility in the use of financial instruments. Farmers will benefit from loans or guarantees up to €200,000 at low interest rates that are not only linked to investments but can also contribute to cash-flow to finance costs or compensate losses

Unused 2nd pillar funds will be allowed to be reallocated by Member States instead of being returned to the EU budget.

The deadline for submission of Annual Implementation Reports for Rural Development Programmes has been postponed from June 30th

The advance of director support and Rural development aid is set to rise from 50 to 70% (direct aid) and from 75% to 85% (rural development) with farmers to receive funds from October 16th

Physical on the spot checks are proposed to be reduced and greater flexibility given to timing requirements which will minimise contact between farmers and inspectors

A temporary Framework for State Aid has been adopted: farmers can benefit from a maximum aid of €100,000 per farm. This aid can be topped up by de minimis aid which is national aid specific to agriculture which does not require prior approval from the Commission. This ceiling was increased to €20,000 (and up to €25,000 in specific cases) in 2019. Total national support per farm is €120,000(or €125,000) under this temporary framework

Furthermore, the EU Commission provided for a relaxation of state aid rules to enable member states to fund temporary export credit insurance. For the Irish Government, this merits serious consideration in relation to the dairy sector, as it could maintain market flows to markets which present a real non-marketable risk linked to COVID-19

In order to keep freight moving across the EU during the current pandemic the Transport Commissioner Adina Vălean has advised member states to designate ‘green lane’ border crossings open to all freight vehicles with delays not more than 15 minutes

Mr Wolfgang Burtscher (Austria) has taken over as Director General of DG Agriculture and Rural Development since April 1st. Mr Burtscher has been responsible for EU’s Strategy on open science and innovation and was previously a director in DG Agri. He succeeds Mr Jerzy Plewa.

MFF

The Commission is working in parallel on proposals for the recovery phase within the existing treaties and will propose changes in the MFF proposal that will allow it to address the fallout of the coronavirus crisis. This will include a stimulus package where the share for regional policy within the package (Cohesion Funds) could rise.

COPA COGECA

The COPA offices are closed as are the Farming Association offices with staff working from home.

Farming Association office directors meet via Video Conference weekly on Fridays (POCC meeting) to share and discuss market impact updates and measures taken to address critical issues.

IFA Activity

IFA have held a conference call with the European Commission DG Agri Markets team led by Director Michael Scannell and discussed the current beef, sheep and dairy sectoral impacts in Ireland.

IFA have prepared and submitted an 18-page COVID-19 Emergency document to the European Commission outlining the key impacts and the necessary measures of support that are sought.

Submission has been sent to:

  • Commissioner Wojciechowski (Agriculture and Rural Development)
  • Commissioner Hogan (Trade)
  • Commissioner Sinkevicius (Environment, Ocean & Fisheries)
  • Commissioner Hahn (Budget)
  • Commissioner Breton (Internal Market)
  • Cabinet members (Wojciechowski, Hogan, Sinkevicius, Hahn & Breton)
  • DG Agriculture and Rural Development
  • Irish Permanent Representation
  • Croatian SCA Spokesperson on Agriculture (Croatia currently hold Presidency)
  • All Irish MEPs.

IFA’s Plan B document has been shared with the European Commission – DG Agri and Cabinet Wojciechowski (who have welcomed the excellent initiative), COPA and fellow farmer associations.

IFA have discussed via conference call the immediate crisis in the beef sector with the French National Beef Federation. Mr Jean Pierre Fleury, Chairman of the COPA Beef Working party, is in agreement that measures must address the effect of the closure of the foodservice channel – Irish beef sector relies on foodservice for the sales of 60% of steaks produced. The import of high value cuts into the EU market predominantly from Mercosur is adding to the market imbalance.

Within the sheep sector, IFA have supported COPA’s request to the Commission for a toolbox of measures in particular private storage aid for sheepmeat

IFA supports calls in the dairy sector for private storage aid for all eligible dairy products. The crisis has come just at the approach of peak milk production in Europe with global prices now under pressure. The veal market has seen a huge loss of demand with the closure of restaurants across Europe.

Labour Availability

This is a widespread issue particularly seasonal workers, mostly from eastern European Countries for Fruit and Vegetable Sector:

Austria: A job platform was launched to bring farmers and “volunteers” together to date more than 10,000  have registered.

Austrian Chambers of Agriculture also trying to arrange “flight bridges” from RO/BG to bring in seasonal workers.

Sensitive sectors

The Dutch Horticulture sector has voiced concerns over the collapse of demand for the cut flower and ornamental sector in excess of 70% due to the closure of shops, its main distribution channel. The Aquaculture sector has equally been hugely affected with the elimination of the foodservice sector (falls of 60%+ in sales) and airfreight cost increases for access to global markets.

 Competition

UK: A statutory Instrument on Competition Law was made available(1st April) to provide a specific, temporary exemption to Competition Law to enable grocery retailers, their suppliers and logistics firms to work together to keep supplies flowing and shops open and stocked. The Government is temporarily relaxing elements of competition law as part of a package of measures to allow supermarkets to work together to feed the nation. The move allows retailers to share data with each other on stock levels, cooperate to keep shops open, or share distribution depots and delivery vans. It would also allow retailers to pool staff with one another to help meet demand.

Transport

UK: MOTs for lorries, buses and trailers have been suspended for 3 months from 21st March and from the 30th March all drivers will be handed a 6-month reprieve on their MOT.

Next Up

Communication on Farm to Fork Strategy is postponed until 29th April. There have been calls from the European Parliament (EPP Group) to delay it at least until after the summer. Italian MEP Herbert Dorfmann (group Spokesperson on Agriculture) said that now was not the right moment to impose extra rules on farmers as we face “the biggest crisis that the agriculture sector has seen in decades”.

The Special Committee on Agriculture (SCA) meet by video conference on Monday 6th April. The Irish Department of Agriculture is represented by Breffni Carpenter. This is an important opportunity for member states to provide market impact information to the Commission. Discussions will focus on the Commission’s Market measures and they will also adopt a partial mandate for negotiations on the CAP transitional regulation with the European Parliament.

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