European Union governments should consider changes to the bloc's Common Agricultural Policy (CAP) in a bid to contain the inflation-fuelling rise in food prices, EU commissioner Joaquin Almunia said Tuesday, according to dpa. "For the weakest sector of our society, inflation is the main problem. They are suffering a loss of purchasing power, and must pay more for food and other necessary goods," said the EU's economic and monetary affairs commissioner ahead of a meeting of eurozone finance ministers in Brussels. Among the measures that governments can take to help their poorest citizens is an improvement to "the functioning of our common agricultural policy," he said. The CAP, a complex and expensive system of subsidies designed to protect farmers' incomes, has often been blamed for keeping European food prices artificially high. The EU executive, the commission, is expected to submit proposals aimed at reforming the CAP later this month. But such proposals are likely be met with fierce resistance from big beneficiary countries such as France, which is due to assume the six-month rotating presidency of the EU on July 1st. According to latest estimates, annual inflation in the 15-member eurozone reached a peak of 3.6 per cent in March before falling slightly to 3.3 per cent in April on the back of rising food and fuel prices. Almunia said that while he expected inflation to drop further during the second half of the year, the consumer price index would not approach the European Central Bank's target rate of around 2 per cent until 2009. The commissioner said the EU should also promote measures aimed at tackling "tension" on the international commodity markets. His concerns about inflation were shared by Jean-Claude Juncker, Luxembourg's prime minister and chairman of the Eurogroup's regular meetings.
