Agricultural Trade Policies During The European Union

In the European union there are many different rules that you have to comply with to get one of them is the Common Agricultural Policy (CAP), which attempts to rationalise farming and the production of food and other farmed produce, this is done by allowing subsides to be paid to farmers to grow certain crops, however money spent in the EU can not be spent on reliving unemployment, which is a major concern in all EU states.

The 1960s pushed farming to a new low. “federal agriculture policy continued to curtail surplus production and raise farm incomes, but it placed greater emphasis on guaranteeing low food prices” (Miller, 2011). Farmers were competing with other farms just to keep their farms and homes. The government implemented additional programs like the use of food stamps and the free school lunch programs, which further deemphasized the necessity for production for the farmers.

Many critical or interesting issues, problems, concepts that arose from the article about the agriculture downturn of prices in the United States of America. Subsequently the farmers are receiving subsidy from the government. This implies that the economy of agricultures has

 Some argue that the current degree of integration is an economic union with an  evolving common political structure (but this is not entirely true given that all countries  do not share a common fiscal policy).   EU Objectives    Provide for free internal flow of production factors:   o Labour   o Capital   o Products    Provide protection for European industry and workers (free trade within and  protection outside countries)  o Tariffs and quotas applied to most basic commodities and services    Steel, Coal, Textiles, Agricultural Products    Banking,

The agriculture industry has been ever changing, due to the population increases. Subsidies keep the small farm going, protecting

The federal government offers a wide range of aid to farmers, including: price supports and price floor programs; crop insurance against both lost crops and lower than expected prices; government purchases of excess food stocks; and promotion of domestic crops through international trade agreements. The United States was forced to develop agriculture price and income support policies after the end of World War I due to the closing of major international export markets. The passing of laws of agricultural subsidies, a price aid to farmers grew from the farm income and financial crises. Agricultural subsidies are justified as necessary to

In the three centuries preceding 1300, European agriculture methods had improved. There was more land, more food and also more people. During the 1340s, England became a society vulnerable to economic and social stress. The population had grown to such an extent that the land could not provide enough food to support everybody. There were changes in the weather patterns. The summers became extremely hot, while the winters were just way too cold. Because of this extreme weather, the crops were dying. There was just not enough food to feed everybody. This bad harvest let to a high mortality rate, as grain prices more than quadrupled. This also brought drought, famine and a widespread of starvation.

The Agriculture sector has changed monumentally over the past century in response to vast economic change and technological advancements. Farm subsidies are various forms of payments from the federal government put in place in an effort to stabilize prices, keep farmers in business, and ensure quality of crops. The federal government currently pays $20 billion in cash each year to US farmers and spent an estimated $250 billion between 1995-2005. Presently, a new farm bill is passed every five years

Initially envisioned as a confederation of member states collaborating together for mutual benefit, the EU and its 27 member nations established a single integrated market with the goal of facilitating trade and international commerce. With the introduction of the Euro across the Eurozone, this monetary system has proven to be unsustainable given the region's traditional reliance on entitlement programs and social assistance. With federal budgets stretched to their limit, "the debt crisis has already spread through Greece, Ireland and Portugal, all of which have

In 1992, twelve countries came together and signed the Maastricht Treaty creating the European Union (Krajewska, 2014, pp. 6-25). The last obstacle that the EU had to face was the different currencies of each country, therefore a decade later on January 1, 1999 the Euro was created. Many countries that adopted the new currency fell within the Euro Area. Each country had to discontinue their old currency and the monetary policies giving control the newly formed European Central Bank (ECB), but each separate country still had their own fiscal policies one of the key reasons for the current debt crisis (Krajewska, 2014, pp. 6-25). The union of multiple countries into a central body seemed to be a wise choice for greater economic growth, but the failure from one country is a failure for all.

Nowhere have protectionist tendencies been more evident than in agriculture. Across developed nations, trade barriers for agricultural commodities remain higher than those for manufactured goods. For example, the World Trade Organization (WTO) estimates that on average the U.S. imposes tariffs of 4.72% on agricultural products as opposed to 3.56% on non-agricultural imports (Tariff Analysis Database, n.d.). While these tariffs are lower than those of many other developed nations, the U.S. also provide significant subsidies to agricultural producers that tend distort international markets. In the author’s opinion, the U.S. and its trading partners should pursue further agricultural trade liberalization. This position is developed in the following paragraphs. First, the economic principles favoring free trade are presented. Next, opposing arguments are considered. Finally, the paper concludes by recommending that

In 1957 the Common In 1957 the Common Agricultural Policy (CAP) was outlined by the then six member states. The main reason for the Common Agricultural policy was to make Agriculture a self sufficient entity in The European Union. The six member states of the European Union proposed to do this by creating a stable market for agricultural produce and at the same time keeping prices at an affordable level for consumers.

The agreement is comprehensive and involves agriculture, fishery, and forestry goods, apart from maintaining import duties on sugar and export duties on several products. For Russia, the Agreement is a complex balance of political and economic costs and benefits, exposing Russia’s agriculture to greater competition from the other nations, but allowing it to gain greater geopolitical and economic influence in the region.

When considering the challenges and opportunities posed by EU non market policies, we must look at both the food producer and the manufacturer as both can have positive and negative reactions. Going forward, global warming is now high on the agenda of policy makers. With agriculture a high contributor, it is unsurprising that measures are being introduced that have effect on the producers’ and manufacturers’. The buzz word now associated with the future of the environment and the food industry is “sustainability”. This refers to sustainable growth as the producers (farmers) try to maximise output. Moreover, with world populations set to dramatically increase up to 2050, the EU and the world must find ways to promote food production. Therefore, policies are now becoming more difficult and multifunctional. This is symbolised through the increasing awareness of the environment and it becoming more and more apparent in the Common Agricultural Policy (CAP). “The industry realises the need to protect and, where possible, improve biodiversity. Given that the industry’s raw materials are grown in the natural environment, and the industry purchases and processes 70% of EU agricultural production, it is essential that agricultural practices are sustainable.” FoodDrink Europe. (2011). It is here in the CAP that I have found non-market policies to have impacted both positively and, at times, negatively on the food producers and manufacturers operating in the EU. The

With the effect of the Single European Act on 1st July 1987, the emergence of European Union (EU) as a common market has essentially been created. The benefits of this act are substantial to European firms, economies, and workers. It eliminates conflicting national regulations and trade barriers, as well as offering firms opportunity to sell their goods to all other EU members (Griffin & Pustay 2005).