CAP measures towards environmental sustainability: Trade opportunities for Africa?

Abstract

The future EU Common Agricultural Policy (CAP) requires coherence with the Sustainable Development Goals (SDGs) and the international commitments in the fight against climate change. Next to ensuring stable food supply by supporting farmers and enhancing agricultural productivity, environmental sustainability is a core aspect of the proposed future CAP. At the same time, new policies must not compromise socio-economic development in low-income countries, especially in Africa, as stated in the European consensus on development. On the contrary, the extensification of agriculture in the EU may create trade opportunities for African countries. We apply a global agri-economic model to assess trade-related impacts of potential, environmentally motivated changes of CAP policies in the EU and Africa. Our findings suggest that EU production levels of meat would change with a stronger environmental focus of the CAP. These changes reduce the EU’s share in agri-trade flows to Africa. However, food supply in Africa is not projected to deteriorate, as imports from other world regions and, to a limited extent, increasing domestic production can fill the gap. In how far potentials for domestic production growth can be used in African regions depends at least partly on their competitiveness vis-á-vis substituting importers. A sensitivity analysis on reduced transport costs shows that infrastructure investments could contribute to a stronger integration of Africa in international markets. On a global level, our analysis reveals the need to balance sustainability trade-offs in terms of avoiding leakage effects from EU agricultural productionchanges versus facilitating economic growth potentials in low- and middle-income countries.