  We analyze the new threshold data for neutral pion photoproduction off
protons in the framework of heavy baryon chiral perturbation theory. We show
that large loop corrections are needed to understand the S--wave multipole
$E_{0+}$ and that all pertinent low--energy constants can be understood within
the framework of resonance exchange saturation. Previous inconsistencies in the
description of this reaction in the threshold region are resolved.
