Agricultural Support: Consequences of the Eventual Accession of the Balkan Countries to the Eu1

The author estimates the potential impact of the accession of seven Balkan countries (Albania, Croatia, Bosnia and Herzegovina, Macedonia, Montenegro, Serbia and Turkey) to the EU on the agricultural direct payments and rural development expenditures disbursed from the EU budget. The estimation is based on the assumption that the agricultural support to GDP ratios are similar across member states at similar levels of development sharing a similar weight of agriculture in the economy. The results show that the annual additional burden for the 27 current EU members due to a Balkan enlargement would range between EUR 5 and 11.5 billion (in 2004 prices). The former figure reflects an agricultural support to GDP ratio corresponding to the average of the 12 new member states; the latter reflects the respective (average) ratio of Bulgaria and Romania. In relative terms the Balkan enlargement would necessitate a net increase of the pool of transfers for direct payments and rural development expenditures in the range of 10% to 23%.