Atmosphere the Life a Report by Allah Dad Khan Former DG AGri KPK
© European Communities, 2007 Background Economic models are indispensable instruments to support...
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© European Communities, 2007 Background Background • Economic models are indispensable instruments to support policy-making by DG AGRI. • Key topics for DG AGRI: reform of the Common Agriculture Policy (CAP), markets (food prices, biofuels), trade policy negotiations (bilateral, WTO), rural development. • DG AGRI (customer) requests and co-finances support with model analysis by IPTS. • Advantages of IPTS Modelling Platform: cluster of excellence, synergy across models, EC internal (work partly sensitive). • IPTS provides ad-hoc model results, in-depth studies, policy recommendations. Support to Agricultural Policy Making with Economic Modelling Tools Contact Dr. Robert M’barek and Dr. Ignacio Perez Dominguez European Commission • Joint Research Centre Institute for Prospective Technological Studies Tel. +34 954488489 • Fax +34 954488434 E-mail: Robert.M’[email protected] [email protected] Agricult ure Rest of Economy region world world AGLINK AGMEMOD CAPSIM ESIM CAPRI GLOBE GTAP World markets WTO EU27 markets CAP reform Farm income & structure Trade Investment Factor markets DG RTD: FP6 & FP7 Academia Customer DG AGRI Farm/ Household Fig. 1: Agro-Economic Modelling Platform at IPTS Current state of Modelling Platform Current state of Modelling Platform • Seven highly complex modelling tools established (Fig. 1): Agricultural Sector Models: CAPRI, AGMEMOD, CAPSIM, AGLINK, ESIM General Equilibrium Models: GLOBE, GTAP • Different policy issues covered: reform of CAP, world markets, rural development • Modelling on different regional scales (countries, NUTS-2 regions) • Excellent links to academic modelling community Customer support (DG AGRI) by means of the Customer support (DG AGRI) by means of the Agro-Economic Modelling Platform Agro-Economic Modelling Platform (1) Processing of the request • IPTS translation of the policy-makers’ request into applicable research questions and preparation of internal project planning • Scenario construction and decision on assumptions on macro-economic factors in collaboration with the customer (2) Selection of tools • Close collaboration with the customer and research institutions (original developers of the models) is crucial. • Out of the available tools in the Modelling Platform the appropriate ones are selected. (3) Output / Dissemination • Analysis and interpretation of results in the broad context of the policy and interactions with the overall economy. • Reports for policy makers (policy briefings), technical reports, scientific publications (peer reviewed journals), contribution to EC publications. Source: European Commission (2007) Rural Development in the European Union - Statistical and Economic Information - Report 2007 Example for customer support Example for customer support • DG AGRI requests an outlook of agricultural markets and rural development indicators in a medium-term baseline (2013). • IPTS selects the appropriate modelling tools: to perform agricultural market prospects ESIM and AGLINK, to break down the results on regional level and incorporate environmental and labour indicators CAPRI. • As an illustration of results for the outlook on agricultural markets, Fig. 2 shows a map on income changes derived from CAPRI: EU-27 agricultural income would grow by 23.2 % between 2005 and 2013 in real terms and per labour unit. However, this overall gain would mask marked differences between EU-15, EU-10 and EU-2 as well as between individual regions. Moderate development of agricultural income in the EU15 (+ 9.3 %) over the period 2005-2013. In the EU12 more pronounced picture (+ 37.1 %). • In Fig. 3 a map of an environmental indicator (nitrogene balance) resulting from CAPRI is provided: In vast majority of the regions change in surplus is rather small (between 0 and +4 kg/ha). Projected surplus in parts of the Netherlands, Belgium, Germany, Brittany or the Po valley is still at rather high levels. Fig. 3: Projected change in gross Nitrogene balance (kg N/ha) in % from 2002 to 2013 • Contribution to EC publications: European Commission (2007): Prospects for agricultural Markets and Income in the EU 2006-2013 Chapter contribution to European Commission (2007) Rural Development in the European Union - Statistical and Economic Information - Report 2007 Agriculture Income = Revenues minus Costs plus Premiums (i.e. income available to farmers to pay for land, labour and capital, plus profits) Source: CAPRI Modelling System, Baseline Update December 2006) -20 -10 5 20 30 51 Fig. 2: Medium term change in regional value added per hectare as compared to the EU-27 average (%)
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BackgroundBackground• Economic models are indispensable instruments to support policy-making by DG AGRI.• Key topics for DG AGRI: reform of the Common Agriculture Policy (CAP), markets (food prices, biofuels), trade policy negotiations (bilateral, WTO), rural development.• DG AGRI (customer) requests and co-finances support with model analysis by IPTS.• Advantages of IPTS Modelling Platform: cluster of excellence, synergy across models, EC internal (work partly sensitive).• IPTS provides ad-hoc model results, in-depth studies, policy recommendations.
Support to Agricultural Policy Making with Economic Modelling Tools
ContactDr. Robert M’barek and Dr. Ignacio Perez DominguezEuropean Commission • Joint Research CentreInstitute for Prospective Technological StudiesTel. +34 954488489 • Fax +34 954488434E-mail: Robert.M’[email protected] [email protected]
Agriculture Rest of Economy
region worldworld
AGLINK AGMEMODCAPSIM
ESIM CAPRI GLOBEGTAP
World marketsWTO
EU27 marketsCAP reform
Farm income & structure
TradeInvestment
Factor markets
DG RTD: FP6 & FP7 Academia
Customer DG AGRI
Farm/ Household
Fig. 1: Agro-Economic Modelling Platform at IPTS
Current state of Modelling PlatformCurrent state of Modelling Platform• Seven highly complex modelling tools established (Fig. 1):
Agricultural Sector Models: CAPRI, AGMEMOD, CAPSIM, AGLINK, ESIM General Equilibrium Models: GLOBE, GTAP
• Different policy issues covered: reform of CAP, world markets, rural development• Modelling on different regional scales (countries, NUTS-2 regions)• Excellent links to academic modelling community
Customer support (DG AGRI) by means of the Customer support (DG AGRI) by means of the Agro-Economic Modelling Platform Agro-Economic Modelling Platform (1) Processing of the request• IPTS translation of the policy-makers’ request into applicable
research questions and preparation of internal project planning • Scenario construction and decision on assumptions on macro-
economic factors in collaboration with the customer(2) Selection of tools• Close collaboration with the customer and research institutions
(original developers of the models) is crucial. • Out of the available tools in the Modelling Platform the
appropriate ones are selected. (3) Output / Dissemination • Analysis and interpretation of results in the broad context of the
policy and interactions with the overall economy.• Reports for policy makers (policy briefings), technical reports,
scientific publications (peer reviewed journals), contribution to EC publications.
Source: European Commission (2007) Rural Development in the European Union - Statistical and Economic Information - Report 2007
Example for customer supportExample for customer support• DG AGRI requests an outlook of agricultural markets and rural development indicators in a medium-term baseline (2013).• IPTS selects the appropriate modelling tools: to perform agricultural market prospects ESIM and AGLINK, to break down the results on regional level and incorporate environmental and labour indicators CAPRI.• As an illustration of results for the outlook on agricultural markets, Fig. 2 shows a map on income changes derived from CAPRI:
EU-27 agricultural income would grow by 23.2 % between 2005 and 2013 in real terms and per labour unit. However, this overall gain would mask marked differences between EU-15, EU-10 and EU-2 as well as between individual regions. Moderate development of agricultural income in the EU15 (+ 9.3 %) over the period 2005-2013. In the EU12 more pronounced picture (+ 37.1 %).
• In Fig. 3 a map of an environmental indicator (nitrogene balance) resulting from CAPRI is provided:
In vast majority of the regions change in surplus is rather small (between 0 and +4 kg/ha).Projected surplus in parts of the Netherlands, Belgium, Germany, Brittany or the Po valley is still at rather high levels.
Fig. 3: Projected change in gross Nitrogene balance (kg N/ha) in % from 2002 to 2013
• Contribution to EC publications:European Commission (2007): Prospects for agricultural Markets and Income in the EU 2006-2013Chapter contribution to European Commission (2007) Rural Development in the European Union - Statistical and Economic Information - Report 2007
Agriculture Income = Revenues minus Costs plus Premiums (i.e. income available to farmers to pay for land, labour and capital, plus profits)Source: CAPRI Modelling System, Baseline Update December 2006)
-20 -10 5 20 30 51
Fig. 2: Medium term change in regional value added per hectare as compared to the EU-27 average (%)
