Government support for agriculture in OECD countries remained on a downward trend in 2013, yet much of this support is still in a form that distorts markets.
The report finds that support to producers in 2013 amounted to 18% of gross farm receipts, down slightly from 2012 and compared with around 30% two decades ago. Half of the USD 258 billion (EUR 194 billion) total in 2013 was earmarked to instruments that distort production and trade, however.
The report makes the following recommendations:
- Market intervention mechanisms should be dismantled in favour of support that is de-linked from production and more targeted to specific needs, in line with stated policy priorities of increasing productivity and sustainability.
- Farm policies should be more consistent with macroeconomic, trade, structural, social and environmental policies. They should reduce impediments to structural adjustment to attract financial and human resources to the sector.
- Countries should avoid any recoupling of support to production, which can lead to higher costs and market disruption. Future reforms could usefully include relaxing or ending production quotas.
- Funds freed up by more efficient farm support should be invested in education, infrastructure, and innovation in the sector. Governments should be bolder about prioritising the environment and the sustainable use of natural resources.
- Governments should ensure that their interventions do not crowd out market-based risk management tools and farmers’ own management of normal business risks.
Agricultural Policy Monitoring and Evaluation 2013: OECD Countries and Emerging Economies
Agricultural Policy Monitoring and Evaluation 2012: OECD Countries
Agricultural Policy Monitoring and Evaluation 2011: OECD Countries and Emerging Economies