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The N-VA wants to unite farmers for more economic power
Flemish farmers urgently need more market power. That is the conclusion of the plan by MEPs Geert Bourgeois and Johan Van Overtveldt and Flemish MP Sofie Joosen. They are calling for farmers to have the ability to form associations in product organisations so that they can negotiate a better price for their products. “European competition policy does not stand in the way of this, but most farmers do not know that,” says initiator Geert Bourgeois.
No less than a third of the entire EU budget goes to agriculture, yet numerous Flemish farmers are fighting to keep their heads above water. One in four Flemish farmers even lives below the poverty line and one in seven suffers a loss. The N-VA parliamentarians therefore want farmers to acquire more market power. Sofie Joosen: “Establishing producer organisations can be an important step forward. As a government, we must support and simplify this,” she says.
The agricultural sector consists to a great extent of fragmented small family businesses. They often find themselves in a weak bargaining position vis-à-vis strong, large suppliers and buyers. Because of this lack of market power, they lose revenue. In order to rectify this skewed balance of power, farmers must be able to unite. This can be achieved under a recognised producer organisation. In this way, farmers can make joint agreements, join forces and stand stronger during negotiations.
It is allowed by Europe
European competition policy, which normally prohibits cartel formation, allows this exception within agricultural policy. Geert Bourgeois investigated this, and it was confirmed by European Commissioner for Competition Margrethe Vestager. She acknowledged that farmers who make use of the exception do indeed receive better prices for their products. Many farmers are not aware of this exception. According to Johan Van Overtveldt, this would also have positive implications for the European budget. “Given the pressure on the budget, it is a matter of time before European agricultural subsidies are threatened. By giving more market power to farmers, we are creating more budgetary scope.”
The parliamentarians call on Flemish Minister of Agriculture Jo Brouns (CD&V party) to promote the establishment of agricultural producer organisations through awareness campaigns and to reduce the administrative burden of establishing such organisations. This could be done with so-called de minimis aid amounting to EUR 25,000.