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Boost Proposed for EU Farmers

May 8, 2001

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BRUSSELS, Belgium (AP) _ The European Commission is proposing a 5 percent increase in spending next fiscal year to support the European Union’s farming sector, which has been hit hard by foot and mouth and mad cow diseases.

Michaele Schreyer, the EU’s budget commissioner, said the 15-nation bloc would have to spend more next year to continue supporting farmers coping with the ongoing costs of fighting the two animal ailments, which have left many in financial ruin.

``This draft budget arrives at a crucial time for agriculture,″ Schreyer told reporters. ``There are a couple of major crises we had to deal with this year. ... That will have implications.″

The EU’s head office is calling for a total budget commitment of 100 billion euros ($88.8 billion) for 2002, covering everything from wages to foreign aid. That is up from 85 billion euros in this year’s budget.

Despite calls from many EU governments to reduce EU farm subsidies, the agricultural budget still accounts for the largest share of the annual budget, or just over half. A review of agriculture spending is expected in 2003.

Schreyer said the EU is proposing to commit 46. 2 billion euros ($41 billion) for agriculture next year, of which 1.145 billion euros ($1.02 billion) would be spent on eradicating mad cow disease and 250 million euros ($222 million) on fighting foot and mouth disease. It will also allocate an extra 1 billion euros ($884 million) for a farm emergency fund, if needed.

The EU has already spent close to a billion euros to pay for existing measures to combat mad cow disease, like the costly ``purchase for destruction″ plan which aims to buy and cull up to 2 million head of cattle to reduce the supply of beef on the market and bring back some price stability.

Schreyer said the proposed budget, which will have to be approved by EU governments and the European Parliament, meets existing financial commitments made by EU leaders in 1999, which laid out stringent spending guidelines to keep EU spending from spiraling out of control ahead of eastward expansion.

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