EU agricultural policies
The Common Agricultural Policy (CAP)
The European Union’s Common Agricultural Policy (CAP) has been a major obstacle for progress on the Doha negotiations. When the CAP was established over 40 years ago a primary focus was internal price support to promote food self-sufficiency within the member states. In effect the CAP protects EU farmers from external competition by controlling market access (through import tariffs and other means) and by providing domestic support as well as export subsidies.As a result, the prices EU agricultural producers receive tend to be well above international levels as well as very stable. High prices encourage farmers to increase production, while the high consumer prices discourage consumption and imports. The combination of the various factors leads to the need to export surplus production. There are two ways in which the CAP can negatively affect agricultural producers and exporters in other countries:
- Lowering international prices for raw agricultural products
- Selling surplus goods very cheaply into specific markets –also known as dumping- thereby undercutting local producers
Recommended reading
- The EU’s CAP, the Doha Round and developing countries
- ( M. Halderman; N. Nelson / University of California, Berkeley Library , 2004)
- This study analyses the political economy of European Union (EU) policy-making in regard to EU trade in beef and dairy with developing countries. The main objective is to determine and assess how rele...
- Dumping on the poor: the Common Agricultural Policy, the WTO and International Development
- ( D. Green; M. Griffith / Catholic Fund for Overseas Development , 2005)
- This paper critiques the EU's Common Agricultural Policy as a mechanism that promotes over-production and dumping of cheap goods that undercut local markets in developing countries. At the same time t...
