Seeking more open and innovative agriculture

Bernard Lehmann says Swiss farmers should invest now to conquer new markets Keystone

Swiss farmers have been reluctant to open up to foreign competition, but the new head of the Federal Agriculture Office tells swissinfo.ch opportunities exist abroad.

Bernard Lehmann, a professor of agricultural economics, has taken over one of the higher-profile government jobs on July 1 at the age of 57. He will have to convince one of parliament’s strongest lobbies that change and more open markets will be to everyone’s benefit.

swissinfo.ch: What will be your priority as head of the agriculture office?

Bernard Lehmann: I’m taking over at the very time the agriculture legislation is being overhauled, with a reform of the direct payment system (see sidebar), and which should become effective in 2014. Making that work will be one of my priorities.

Some powerful groups are also opposed to opening Swiss agriculture to the European market. Others believe we have no choice but to follow that path. I think we need to prepare the farming sector for these changes, and that will be my another of my priorities. But not with threats or pressure like has happened for the past 20 years. Rather we have to encourage farming professionals to implement changes to their structures, their portfolio and the positioning of their products. There has to be a desire to open the market, and less pain and fear.

swissinfo.ch: The House of Representatives has recently asked for an end to the agricultural negotiations with the European Union. Is that a problem for you?

B.L.: With Economics Minister Johann Schneider-Ammann, we will have to find a middle way between the different interest groups involved in the agricultural debate. One chamber of parliament has asked for the talks to be stopped, but the Senate still has to discuss the matter. And as the cabinet is responsible for the negotiations, it will decide if it takes into account this request. It could be that parliament does influence the government.

But our long-term objectives are already set, and the administration’s task will be to manage the transition as best it can, maybe for a little longer than planned.

swissinfo.ch: What are the strengths of the Swiss agriculture sector abroad?

B.L.: Consumers in Europe and around the world are more and more aware of the risks of purchasing anonymous products or ones that are too cheap. The positioning of Swiss products on foreign markets relies on our very restrictive environmental and sanitary policies. What are restrictions today, though, could very well be tomorrow’s standards. Investments made now by Swiss farmers could allow them to conquer markets before others.

swissinfo.ch: The cost of farming in Switzerland means the sector can never be competitive with big agricultural nations. How can you justify the ongoing liberalisation and globalisation of agriculture?

B.L.: You have to see the advantages of this global competition. It sharpens entrepreneurial skills and encourages innovation, whereas protectionism paralyses everything.Globalisation means that to stand out, you must produce something specific, to avoid being swallowed up in an ocean of similar products. Before, someone who was protected could get a good price without necessarily supplying the best product. In the future, the best products will get the best prices.

But market forces must be kept in check by criteria such as economic, environmental and social sustainability. In Switzerland, we have done a lot to ensure that the environment and social norms are respected.

swissinfo.ch: You mentioned the environment. Do you eat organic produce?

B.L.: Around 30 to 40 per cent at home. But as a scientist, it’s difficult to argue in favour or against organic agriculture. It has interesting aspects, but it’s no silver bullet.

For example, there are three billion households that are active in the farming sector, of which two-and-a-half billion are organic by default as they cannot afford fertilizers or pesticides.

Many people buy products that are labelled organic because they associate that with a more “human”, more hand-made agriculture. But for me the advantages of organic and conventional agriculture should be combined.

As to whether genetically-modified organisms (GMOs) could play a role, I don’t know. I am concerned because we will have to decide whether to pursue the moratorium on GMOs in agriculture.

From an economic point of view, I would say the agrochemical companies have not managed to demonstrate any business advantages of this technology that would make it worthwhile to have it in the Swiss farming sector. Keeping it away from our production could help our farmers conquer new markets.

Swiss agriculture

The Swiss farming sector occupies one third of the country’s territory, but provides a living for less than three per cent of the population and represents just one per cent of GDP.

Swiss farmers produce around 60 per cent of food consumed by the population and animals.

Around ten per cent of the country’s farms are considered organic producers.

Agriculture and forestry are the fourth largest professional group in the Swiss parliament.

Direct payments

Swiss agricultural policy includes direct payments as compensation for communal and environmental services provided by farmers.

These payments were introduced were introduced in 1993 as part of a comprehensive reform package.

The core of these reforms was the phasing out of market intervention. During the 1990s, state guarantees for prices and markets were gradually eliminated, causing farmers’ earnings to fall substantially.

Since 1999, all direct payments (around SFr2.8 billion per year) have been based on proof of ecological performance. This ensures that ecological methods are used throughout the country.

The system is under scrutiny, with new legislation proposed. If accepted, it would implement five types of payments for:

Landscape cultivation

Food security

Maintaining and promoting biodiversity

Landscape quality

Animal welfare beyond legislative norms.

(Adapted from French by Scott Capper)