The European Union instituted its Agenda 2000 reforms of the Common Agricultural Policy at the April 1999 Berlin summit. The planning for Agenda 2000 looked ahead in a rapidly changing world to the future impact on the CAP of changing market conditions, the future entry into the EU of the former communist countries in Central and Eastern Europe, and to the implications of the forthcoming WTO agricultural trade negotiations beginning in 1999. The process also had to take into account demands for increased expenditures for agri-environmental and rural development measures. The Agenda 2000 reforms went through a long and convoluted political process before approval, similar to the previous MacSharry reforms. The final reform package expanded the MacSharry reforms by lowering target prices and providing compensatory payments to farmers. It also created a strengthened Pillar II for the CAP, consisting of rural development and agri-environmental measures. This chapter discusses the development of the Agenda 2000 reforms.