September 3, 2015 / 12:05 PM / 2 years ago

France offers new farm aid as 1,500 tractors hit Paris streets

French farmers converge on Paris, driving their tractors on the motorway, outside Paris, France, September 3, 2015.Charles Platiau

PARIS (Reuters) - France offered its farmers additional financial help on Thursday including tax rebates and investment aid after they drove 1,500 tractors onto the streets of Paris to protest against falling incomes and rising costs.

French farmers, struggling with the effects of Russia's embargo on Western food products and a slump in prices, say higher taxes and stricter environmental protection rules are hampering their competitiveness against European neighbors.

Prime Minister Valls, who highlighted pork, beef and milk producers as sectors facing the most severe crises, said the government's priority was to lift farmgate prices.

The plan included a rise in government support for investment, co-funded by the European Union and French regions, to bring it to 3 billion euros ($3.3 billion) over three years.

The government will also freeze the adoption of new, mostly environmental standards, allow livestock farmers to postpone all debt repayments due in 2015, and will reduce their tax bills.

"Our aim is to give new perspectives and hope to farmers," Valls told reporters.

The government announced a first aid package in July in response to angry farmers who had blocked roads, including access to the Mont Saint-Michel tourist site, and dumped manure outside supermarkets.

The FNSEA, France's largest farmers' union which called for Thursday's protest, welcomed the new package.

"The government has heard us," FNSEA chairman Xavier Beulin told farmers gathered on the Place de la Nation, a regular venue for demonstrations in the east of the capital.

Police said there were 4,500 farmers and 1,580 tractors in the protest, although the FNSEA put the tractor figure at 1,733.

"We came to express our dismay. We can't live from our job anymore," said Patrice Jaouen, a 43-year-old dairy and vegetable farmer leading a tractor convoy from Brittany after driving 588 km (365 miles) since Tuesday.

"We don't want short-lived subsidies, we don't want public money, we want an overhaul of the system."

European Union farm ministers are meeting on Monday to discuss the troubled livestock industry.

France will call for a rise in the minimum price for milk, export incentives and a lifting of Russia's embargo on pork imposed last year after an outbreak of African swine fever in the east of the EU, Valls said.

France has found some support from fellow EU members in southern Europe for more action to help dairy farmers, given a severe market downturn.

But European Agriculture Commissioner Phil Hogan has warned against going back on market reforms, and French Agriculture Minister Stephane Le Foll failed on Monday to agree on specific proposals with his German counterpart ahead of the EU meeting.

($1 = 0.8982 euros)

Additional reporting by Lucien Libert, Chine Labbe and Gerard Bon; Writing by Gus Trompiz and Sybille de La Hamaide, editing by David Evans

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