UNCLAS SECTION 01 OF 02 PARIS 000342

SIPDIS

SIPDIS

BRUSSELS PASS USEU FOR AGMINCOUNSELOR
STATE FOR EBB; OES; EUR/ERA;
STATE PASS USTR FOR MURPHY;
USDA/OS/SCHAFER/CONNER;
USDA/FAS FOR OA/YOST/JACKSON/ROSADO;
OCRA/CURTIS/ALEXANDER;
ONA/RIEMENSCHNEIDER/YOUNG;
OFSO/LEE/YOUNG;
EU POSTS PASS TO AGRICULTURE AND ECON
GENEVA FOR USTR, ALSO AGRICULTURE

E.O. 12958: N/A
TAGS: EAGR ETRD PGOV WTRO EUN FR INR
SUBJECT: FRENCH PRESIDENT SARKOZY ADVOCATES EARLY CAP REFORM,
CRITICIZES WTO DISCUSSION

REF: (A) 2007 PARIS 003853

1. Summary: At the opening of the annual Paris Agricultural Show on
Saturday February 23, French President Sarkozy gave a major address
on agricultural policy announcing his intention to reform the Common
Agricultural Policy (CAP) as early as 2009. He also reiterated his
opposition to any WTO agreement in which the EU makes concessions on
agriculture without measurable concessions by its trading partners.
Sarkozy also stated his intention to propose that France's
gastronomy be listed on UNESCO's World Heritage list. Initial
reactions from French farm groups were generally positive. End
Summary.


2. President Sarkozy emphasized that the 2008 CAP health check done
under the French Presidency should lay the groundwork for a more
complete and in-depth reform of the CAP in 2009, rather than wait
for the 2010 budget discussion. For France, the CAP should focus on
better management of climatic, sanitary and economic risks for
farmers while sustaining agricultural activities in fragile areas.



3. Sarkozy highlighted his four goals for a CAP reform:

- Increased food security for 400 million European consumers. He
stressed that strict EU sanitary, environmental and welfare
regulations should also apply without restrictions to imported
products. Sarkozy also emphasized that the EU preference should be
the basis for a new CAP.

- An EU presence on world agricultural markets. Sarkozy repeated
that European agriculture should help fight hunger in the world.
(Note: that could mean that Sarkozy wants to maintain some kind of
EU export support program. End note).

- A contribution to the fight against global warming and
environmental stewardship.

- More balanced regional development, with policy tools to help
sustain agriculture in fragile areas such as mountainous regions.


4. In carefully chosen words, Sarkozy suggested that farmers should
organize themselves more effectively as an alternative to calling
for systematic subsidies when problems arise. He stated that he will
work with the EU commission so that such groups do not contravene EU
fair competition rules.


5. Sarkozy openly criticized the EU position on current WTO Doha
negotiations as unbalanced. He stated that France will strongly
oppose any agreement that would hurt French agriculture and reminded
the audience that the EU needs unanimity to approve an agreement. He
asked that negotiations be reestablished on a "healthy foundation."
He cited the United States as strong defendant of its agriculture
and called upon the EU to follow the U.S. example.


6. Sarkozy mentioned the biotech issue briefly, calling for a more
integrated policy within the European Union. Europe must "advance
at the same pace" on the issue, he said. (Comment: France is likely
to use its upcoming EU presidency to advocate its approach to
agricultural bio-technology with EU partners. End comment.)


7. Sarkozy also announced that France will propose that French
gastronomy be named on the UNESCO's Intangible World Heritage lists
where it would join Albanian Folk Iso-polyphony or Japan's Nogaku
Theatre.


8. French farm leaders received Sarkozy's proposals positively. They
acknowledged that current high commodity prices will probably make
CAP reform less painful. They however reminded the French President
that they will be vigilant on these issues.


9. Comment: Sarkozy's proposals were consistent with those made in
Rennes on September 11 (Reftel A). Nevertheless, the announcement of
a 2009 reform was somewhat surprising, as in the past France had
refused to consider CAP reform before 2013. We would expect France
to make CAP reform the cornerstone of its agricultural agenda during
its EU presidency, with emphasis on giving member states more

PARIS 00000342 002 OF 002


resources and flexibility to manage crises and using a wider range
of tools such as insurance. France is also likely to propose that
imports be subject to more rigorous standards.

STAPLETON