Fair trade organisations warn against newly increased European Union (EU) quotas for milk production and continued high export subsidies, which will lead to increased milk and butter dumping on world markets. EU dairy products already dominate the African market.
Germanwatch, FIAN and MISEREOR, three German organisations working for global fair trade, today warn about the consequences of the EU’s reforms of its Common Agricultural Policy (CAP) for Africa. While the new compromise includes some cuts in production subsidies, it also holds a major increase in milk quotas for EU farmers.
EU Ministers have renegotiated the CAP, which due to heavy subsidies consumes around 50 percent of Union budgets, and had a special tough time reaching a solution on milk quotas, which some countries wanted abandoned altogether. The Ministers at last agreed to progressively lift milk quotas for farmers by one percent each year before lifting them entirely in 2015.
This, according to Germanwatch, inevitably will lead to cheaper milk in the EU and an even greater pressure to export dairy products. Excessive diary products will increasingly be “dumped” at the world markets, the organisations predict.
Especially for milk and butter, EU Agriculture Ministers agreed on further high export subsidies. In the case of milk and butter, says Mute Schimpf from MISEROR, the EU “continues to opt for export dumping in developing countries.”
Tobias Reichert of Germanwatch adds that this kind of dumping does not do anything to fight poverty and hunger. “Having in mind the growing number of hungry people, it would have been necessary to stabilise international food prices and as such aiding small-scale farmers to increase their production. With its decisions regarding the milk market, the EU is doing exactly the opposite,” concludes Mr Reichert.
According to MISEROR, it is a general problem for development in rural Africa that subsidised products from Europe enter markets in developing countries and create unfair conditions in the competition with local farmers.
Especially when it comes to milk, EU policies are ruining local development. “Milk produced by local famers in Burkina Faso and sold on domestic markets is more expensive than imported milk powder from Europe,” according to MISEROR. “These dumping prices of imported products ruin local farmers’ only source of income. This process increases poverty, hunger and forces more people to migrate to cities in order to earn an income,” the organisation adds.
European dairy products indeed are dominant over most of Africa, even in the many countries where cattle holding is the dominant livelihood. In many African countries, such as The Gambia, attempts to establish dairy plants to provide the national market with milk, butter and other basic products have utterly failed due to EU competition.