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Blair Calls for EU Farm Subsidy Reform

Tony Blair leaves his official residence in London to attend Prime Minister's Question Time at the British parliament
Speaking in parliament, British leader Tony Blair said the European Union must reform its complex and costly farm subsidy program, known as the Common Agricultural Policy, because the prime minister said it serves as a trade barrier against goods from poorer countries.

Prime Minister Tony Blair has hinted that Britain could conceivably give up its $5.5 billion annual rebate from the European Union, if the group's overall financial plans are re-examined and completely overhauled.

But that is very unlikely to happen in the near future. Countries like France, whose farmers benefit hugely from the subsidy program, have vowed to keep it in place.

In the House of Commons Wednesday, Mr. Blair argued once again for EU financial reform. But his rationale this time was not to try to resolve the rebate issue, but to open up markets with goods produced in the world's poorest countries, most of which are in Africa.

"I think that it is important that we make it clear that a reform of the Common Agricultural Policy is not just in the interests of Europe,” said Mr. Blair. “But as my honorable friend rightly says, it is in the interests of the poorest parts of the world who need to be able to get rid of export subsidies for agriculture in the wealthy parts of the world in order for their own economies to flourish. And I think, therefore, it is not just important and relevant and right for the European Union that there is change in the Common Agricultural Policy, it is an essential part of getting a fair deal for the poorest countries in the world."

Tony Blair maintains it is wrong that 40 percent of the EU budget is spent on farming subsidies.

The British rebate was negotiated in 1984 to make up the difference between what Britain paid into the European Union and what it received in the EU budget. Britain tended to get back less than other countries because of its relatively small farming industry, and much of the EU budget was spent on farm subsidies. It is worth 66 percent of the difference between the amount Britain pays into the European Union and the amount it receives in the annual budget.

Britain takes over the rotating presidency of the European Union on July 1. Mr. Blair admits it will be difficult, but not impossible to strike a budget deal while his country holds the influential role.

Most Britons of all political persuasions think the prime minister should negotiate the rebate in the wider context of EU budget reforms. A new survey of more than 2000 people by YouGov and Sky News found that 57 percent backed Mr. Blair's stance on the rebate and reform.