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Recent developments in Luxembourg agriculture

During the second half of the 20th century, Luxembourg’s agricultural sector, like that of all the other EU Member States, underwent a far-reaching restructuring process. It was this period that saw the preparation and integration of Luxembourg’s agriculture into the European Common Market.

During this period, agriculture in Luxembourg was marked by the disappearance of 8 000 agricultural holdings, a decrease of some 6 000 hectares in the amount of land used for farming, a reduction in the number of people living in agricultural areas and working on the land, a rapid expansion of mechanisation, increased recourse to innovation thanks to the introduction of numerous new production methods and techniques, and a marked switch from arable crop production to cattle farming and the arrival on the scene of organic agriculture.

The period in question was also characterised by a process of concentration of holdings and increased productivity.

Since 1962, the number of large-scale holdings, extending over more than 50 hectares, has grown sixfold and their average size has risen from 64 hectares to 104 hectares.

Tasks and remit of the Ministry

The areas of competence of the Ministry of Agriculture, Viticulture and Rural Development are as follows:

  • food production at the level of agriculture, viticulture and horticulture;
  • aspects of food safety linked to primary production;
  • rural development.

For agriculture to be modern, multifunctional and, above all, sustainable, it must be characterised by a complementarity of productivity, protection of the environment and animal welfare, product quality, employment and regional balance. The national strategy for this sector accords with the six priorities laid down in the rules enacted by the European Parliament and the Council relating to the provision of support for rural development by the European Agricultural Fund for Rural Development.

The agricultural sector thus contributes to the Europe 2020 strategy by responding to the new challenges facing our society, in particular those of an economic, social, environmental, climatic and technological nature, through participation in the development of smart, sustainable and inclusive growth.

In addition to confronting these challenges, farmers must constantly adapt their activities in line with meteorological conditions and the situation on the constantly evolving markets for agricultural products.

In this context, it should be stressed that the activities of farmers not only enable us to feed ourselves but also contribute to the preservation of our rural areas and our natural resources – something that is in the interests of all of us. Farmers also play a pivotal role in the revitalisation of the countryside and the rural economy.

The common agricultural policy

The common agricultural policy (CAP) is Europe’s answer to the need to ensure a decent standard of living for 22 million farmers and agricultural workers and to provide a stable, safe and healthy food supply for its 500 million citizens. As a common policy for all 28 EU countries, the CAP strengthens the competitivity and viability of EU agriculture by providing direct payments aimed at stabilising farm revenues, and finances projects responding to country-specific needs through national rural development programmes which also cover the wider rural economy and life in rural areas.

The CAP also provides a range of market measures including tools to address the impact of price volatility and other market difficulties, and additional elements, such as quality logos or promotion of EU farm products, supplementing CAP action to support farmers.

Certain key political priorities for which CAP funding should be used have been laid down at European level – jobs and growth, sustainability, modernisation, innovation and quality. In addition, Luxembourg has the flexibility to adapt both direct payments and its rural development programme to its specific needs.

Fairer and greener direct payments

Luxembourg’s farmers, like their counterparts throughout the Union, are subject to so-called “greening” rules, designed to ensure that they farm in a sustainable way and help contribute to EU efforts to tackle climate change, biodiversity loss and soil quality.

Under this system, 30% of the direct payment allocation, paid per hectare, is linked to three environmentally-friendly farming practices: crop diversification, maintaining permanent grassland and dedicating 5% of arable land to environmentally friendly measures (so-called “ecological focus areas”). Luxembourg uses the standard basic payment scheme for direct payments to farmers, and will gradually converge the level of payments per hectare made to farmers with a deadline of 2019.

Luxembourg has also established a system of lump-sum payments to young farmers.

Supporting key priorities for Luxembourg’s rural development

Rural development is the second pillar of the CAP. It makes available to the Member States a European financial allocation for the management of programmes co-financed at national or regional level within the framework of a multiannual programming system.

In order to meet the various challenges, the Luxembourg rural development programme (RDP) is designed around four EU priorities, the most important of which is the fourth one: restoring, preserving and enhancing the ecosystems linked to agriculture and forestry.

  • The objectives and targets for the different priorities of the 2014-2020 RDP are as follows:
  • viability and competitivity of agricultural holdings;
  • restoring, preserving and enhancing the ecosystems linked to agriculture and forestry;
  • efficient use of resources and climate-related aspects;
  • social inclusion and local development in rural areas.

The Law of 27 June 2016 concerning support for the sustainable development of rural areas transposes, inter alia, the measures provided for by the RDP. It also establishes a statutory framework for the period 2014-2020 in respect of State aid, as part of the continuing reform of the CAP described above.

Rural development in the municipalities

Ever since 1990, the Ministry of Agriculture, Viticulture and Rural Development has been actively assisting the municipalities in the drawing-up of programmes and municipal development plans (MDPs).

In addition to providing logistical and technical assistance, it shoulders part of the costs of municipal planning, with a maximum of 50% of the total cost being borne by the municipalities involved.

In the course of the integrated and participative MDP action, an assessment of the localities concerned is carried out on the basis of a detailed inventory relating to the different thematic areas covered by the MDP in question:

  • the regional context, the demographic development, the socio-economic structures and community facilities;
  • the habitat and the inhabited environment, municipal land management and the development of town and country planning;
  • the natural and human environment and ecology in inhabited areas;
  • socio-cultural activities, local identity and meeting-places.

This integrated and participative approach is aimed at leading to a joint strategy of sustainable development, broadly adopted and supported both by local councillors and by interested parties within civil society. It is being implemented within the framework of the Law of 27 June 2016.

LEADER

“Liaison Entre Actions de Développement de l’Economie Rurale” (“Links between Actions for the Development of the Rural Economy”) (LEADER) is an EU initiative aimed at creating links between projects relating to, and stakeholders involved in, the economic aspects of the rural environment. Thus, its objective is to mobilise the inhabitants of rural areas and to help them to bring their ideas to fruition and experiment with new methods.

The LEADER beneficiaries are the Local Action Groups (LAGs), within which public partners (municipalities) collaborate with private partners coming from the different socio-economic sectors. Pursuing a bottom-up approach, the LAGs are responsible for drawing up and implementing local development strategies.

Since its introduction in Luxembourg in 1991, LEADER has become a key integral part of the regional and national rural development policy. Nearly 440 innovative projects have been carried through thanks to LEADER. Numerous inhabitants of rural areas have been involved in LEADER projects and have reaped the benefits of those actions.

In addition, LEADER provides support for the population and the economy, creates jobs, enlivens cultural and social life, stimulates the exploitation of potential in all its forms, encourages people to unite in action, brings together those who are committed to the various actions, enables innovative ideas to see the light of day and creates contacts between citizens throughout Europe.

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