Prospects of multifunctional agriculture as a facilitator of sustainable rural development: Swedish experience of Pillar 2 of the Common Agricultural Policy (CAP)

Abstract Agriculture remains one of the dominant activities in rural areas across the European Union (EU), not least in respect of land use and its impact on landscapes. The Agenda 2000 reform of the EU's Common Agricultural Policy (CAP) introduced rural development as an integrated part of agricultural policy. The present study focuses on the second pillar of CAP. Multifunctional farming, more than any other rural activity, has a role to play in integrating the natural environment with the cultural landscape and socio-economic development. The question of how multifunctional agriculture can facilitate sustainable rural development is addressed in terms of mechanisms and inherent possibilities. Results from a case study in Östergötland in Sweden are discussed in relation to five other European case studies. Some main findings are that Pillar 2 has made it possible for rural inhabitants to continue living in rural areas and that the policies are effective in identifying and supporting new opportunities for farm diversification. The traditional agricultural landscape can be seen as a key component in various diversification activities in rural areas, contributing to economic as well as social and environmental sustainability. Keywords: agricultural policymultifunctionalityPillar 2sustainable rural development Notes 1. Pillar 1 includes the single-farm payment and the market-based support mechanisms still contained within CAP, such as intervention prices and export subsidies. 2. LEADER translates from French as the 'link between rural development actions'. The LEADER programme was first initiated in 1991 as a tool for delivering rural development funds in an alternative and more flexible way. The purpose was to encourage innovative responses to old and new rural problems, approaches that could then be transferred and used in other regions. In 1991, LEADER was not part of CAP, and was only integrated into Pillar 2 in 2007. 3. Senior authorship is equally shared among the first three authors. All opinions expressed in this article are those of the authors and are not necessarily those of the institutions for which they work. 4. Parts of the study were undertaken within the EU's sixth framework programme: Sustainable Management of Europe's Natural Resources, which operated in the period 2000–2006. In the project (Mattas et al. 2011 Mattas , K. , Arfini , F. , Midmore , P. , Schmitz , M. & Surry , Y. 2011 . CAP's impacts on regional employment: A multi-modelling cross country approach . Moreddu , C. Disaggregated Impacts of CAP Reforms: Proceedings of an OECD Workshop , 251 – 264 . OECD , Paris .[Crossref] , [Google Scholar]), six case study regions in Europe have been studied: Östergötland (Sweden), East Wales (Great Britain), Eastern Macedonia and Thrace (Macedonia), Emilia-Romagna (Italy), Kassel region (Germany), and Southern Great Plain (Hungary). 5. In budgetary terms, the relative weights attributed to the two functions for the period 2000–2006 show that less than 20% of the total allocation in the EU budget to the second pillar of CAP was geared towards measures open to other parties than farmers (the territorial function) (European Communities 2007 European Communities . 2007 . Rural Development in the European Union: Statistical and Economic Information – Report 2007 . European Communities , Brussels . [Google Scholar]). Simply comparing budgetary allocations does not reveal the impact or importance of either function, but can indicate the bias towards the sectoral function. 6. P. Midmore, L. Langstaff, S. Lowman, S. & A. Vaughan 'Evaluating pillar 2 employment impacts: Case study methodology and results for East Wales', unpublished paper presented at the Congress of the European Association of Agricultural Economists, held in Ghent, in August 2008. 7. European Commission. Kommissionens beslut av den 18/X/2006 om godkännandet av ändringar i programdokumentet för landsbygdens utveckling i Sverige under programperioden 2000–2006 godkänt genom kommissionens beslut K(2000)2508. Decision K(2006)5036 by the European Commission 18th October, 2006. 8. In Östergötland, a total of 2477 projects received EUR 59.6 million during the period 2000–2006 (ESF n.d.). 9. A cross-case comparison was made within the CARERA project and reported by P. Midmore and colleagues (see note 6).