GATT and reform of the CAP

Agriculture is at the centre of the Uruguay Round multilateral negotiations, with the United States refusing up to now any compromise in GATT in the absence of an agreement on agricultural policy reform. At the same time, the European Community has started to reorient its Common Agricultural Policy. After difficult negotiations between Member States, the philosophy of the CAP was profoundly changed last May. Focusing on cereals, the reform sharply reduces support prices and replaces them with budget support. A minimal compromise in GATT thus becomes probable, since the United States may adopt a less intransigent stance than at the beginning of the current round of negotiations, its commercial interests being centred on the major crops and largely satisfied, in terms of cereals, through the Community initiative.