The European Union's Common Agricultural Policy is a programme of agricultural subsidy and agricultural trade policy maintained in member states. (Swinbank, 2002) The first part of this essay will give a presentation on the Common Agricultural Policy - i.e…
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Thus (at least) from the perspective of the Treaty on European Union, (and its predecessor Treaties) funding for agriculture should be a medium for reducing or eradicating regional disparities within the European Union. Funding for agriculture within the Union has historically been dispensed under the Common Agricultural Policy.
The Common Agricultural Policy came into being in 1962 after the ratification of the Treaty of Rome in 1957 and the resultant establishment of the Common Market. The establishment of the Common Market came with Treaty requirements that guaranteed the free movement of goods (among other freedoms like the free movement of services, persons, and capital).
The member states of the then European Economic Community - France, Germany, Italy, Belgium, the Netherlands, and Luxemburg - all had different agricultural policies that had some state intervention in the sector. France was however notable for its very strong state intervention in its agricultural sector and insisted on the maintenance of subsidies for the agricultural sector as a condition for the establishment of the Common Market. (BBC Q&A, 2005) Thus the issue of free trade guarantees in the Treaty of Rome and the barriers to trade in agricultural products that individual state intervention through subsidies in the agricultural sector would bring was evident. ...
olicy thus presented a compromise through which a harmonisation of state intervention on a common basis could be maintained within the free trade guarantees of the Treaty of Rome and for the functioning of the Common Market.
The establishment of the Common Agricultural Policy had the following objectives - to increase productivity to ensure fair living standards for the agricultural community, to stabilise markets, to ensure availability of food, and to provide food at reasonable prices. (Article 39 of the Treaty of Rome)
In practice, the Common Agricultural Policy is a programme of financial subsidy paid to farmers and a trade policy that sets tariff and quota restrictions on the import of agricultural products from outside the European Union's Common Market. (El-Agraa, 2007) The financial subsidy under Common Agricultural Policy offers a guaranteed minimum price payable to producers of agricultural products, though the actual implementation and maintenance of the subsidy programme varies from different member states in the European Union.
The Common Agricultural Policy has undergone changes over time to meet with policy, structural and domestic and international demands for reform among others. Currently, the 'decoupling' scheme is one of the central reform tools being used by the European Union detach production subsidies. (Jeffery, 2003) Payment of subsidies is no longer tied to the volume of production of agricultural produce. The single payment scheme is one of the policies that have been adopted to 'decouple' subsidies from production. (El-Agraa, 2007; Anderson and Josling, 2007) The maintenance of subsidies with production had resulted in a system where farmers produced for subsidies and not necessarily for the market. This resulted in an over production of
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(“The Common Agricultural Policy Essay Example | Topics and Well Written Essays - 2000 words”, n.d.)
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(The Common Agricultural Policy Essay Example | Topics and Well Written Essays - 2000 Words)
“The Common Agricultural Policy Essay Example | Topics and Well Written Essays - 2000 Words”, n.d. https://studentshare.org/politics/1522462-the-common-agricultural-policy.
We cannot change the informal constraints, at least not in the short run; and even our ability to control enforcement is very limited" (p.11). As an Economics Nobel Prize awardee, North was motivated to scan through the revolution in economic years ago. The resulting thesis demonstrated that economic performance is determined largely by the kind and quality of institutions that support markets.
However, the CAP has subsequently been the victim of its own success. The CAP arrangements resulted in large surpluses and budget crises in the 1980s (Harrison et al, 1995). Because of the peculiar decision making process in the European Union, the required reforms were delayed until the early 1990s.
In terms of operation, the CAP combines a direct funding for crops and land that may also be cultivated with the help of price support system and may also include import tariffs, a guarantee of minimum prices, and the fixing of quotas on a number of goods that comes from outside of the European Union.
It is said that these subsidies add to the problem that is called Fortress Europe.A high amount is spent on agricultural subsidies which gives a boost to unfair competition.The demand for certain farm products is set at an optimistically high level in contrast to the free market demand.
tablishment of common agricultural policies and support payments, including levies and price and structural supports. It is important to mention that the price of agricultural products is not set by the farmers but by the Council of Ministers through the European Agricultural Guidance and Guarantee Fund (EEAGF).3 As regards agricultural trade policies, these are the responsibility of the Special Committee for Agriculture.4 As a result of these measures, or to be more specific, because of CAP, the price of agricultural produce in the European Union are not related to the world market price and levies on agricultural imports ensure that cheap goods do not enter the EU agricultural produce c
The policy also helps in the organization of various payments to farmers who in their own way have managed to bring about the variation of various products. The common agricultural policy can also be described as an agreement
ce it was serviceable to curbing the threats of overproduction, underproduction, and undervaluation of the products presented in the markets (Boyes & Melvin 2008, p. 52). The following discussion seeks to assert on demand and supply practices, and further to intensify on a
s a common agricultural policy that is designed to support farming, provide food security and promote balanced development (Baldwin & Wyplosz, 2012, p. 421). Ideally, over 77% of its territory is rural and home to over half of the population. Farming is intensive, organic, and