Common Agricultural Policy

Common Agricultural Policy (CAP)

in the law of the European Union, one of the very foundations, being the legal regime supporting the coordination of agriculture in Europe. Although included in the Common Market, it was necessary to make special provision for agriculture because of the contradictory nature of the policies of some founding member states, made none the easier by the accession of others. The essence of it is that the market is unified, allowing free movement of goods throughout the Community.

There is a Community preference protecting the market against imports from outside and the CAP is to be financially secure: the European Agricultural Guidance and Guarantee Fund was set up to this end. Market organizations have been set up for most products, which have the effect of stopping member states from setting up competing systems. The principal effect of the CAP differs in relation to different products: wheat and related produce are protected by intervention purchases made to support producers; beef and related produce are supported by excluding outside competition; and fruit and vegetables and wine are controlled by quality.

The intervention price is set as that at which the national authorities must buy certain crops - some farmers may be tempted to grow crops for the intervention price rather than any real market. The more member states become involved in the Union, the more interested they become in reforming the CAP rather than using it as an excuse for complaining. The target price is part of the cereal market scheme. It is the price at which it is expected that sales can be made in the next year in the Union. It is not a fixed price. It is established annually by the Council with a qualified majority on a proposal from the Commission after consulting the Parliament.

The threshold price is the price fixed for certain imports from outside countries. It protects Union farmers from outside cheap competition. It is fixed by taking the cost of imports and making sure that it does not exceed the set internal target price. Reforms introduced in 1999 emphasize food safety, environmental objectives and sustainable agriculture. These objectives, which fall outside the scope of market policy, now, with rural development, have become the second pillar of CAP. The reforms in 2003 consist of simplification of market support measures and direct aid by decoupling direct payments to farmers (the aid which they receive is not tied to production); reinforcing rural development by transferring market support funds to rural development through modulation (reductions in direct payments to large farms); a financial discipline mechanism (ceiling placed on market support expenditure and direct aid between 2007 and 2013). In 2004, a second set of initiatives was introduced including: reform of aid to Mediterranean products (tobacco, hops, cotton and olive oil) and a proposal for the reform of the common organization on the market in sugar.

Common Agricultural Policy

the EUROPEAN UNION's programme for the subsidization and protection of the farm sector.

Common Agricultural Policy (CAP)

the policy of the EUROPEAN UNION (EU) for assisting the farm sector. The main aims of the CAP are fair living standards for farmers and an improvement in agricultural efficiency (see AGRICULTURAL POLICY).

The CAP is administered by the European Agricultural Guidance and Guarantee Fund, with major policy and operational decisions (e.g. the fixing of annual farm prices) residing in the hands of the Council of Ministers of the EU. The farm sector is assisted in four main ways:

around 70–75% of EU farm produce benefits directly from the operation of a PRICE-SUPPORT system that maintains EU farm prices at levels in excess of world market prices. The prices of milk, cereals, butter, sugar, pork, beef, veal, certain fruits and vegetables and table wine are fixed annually and, once determined, are then maintained at this level by support-buying of output that is not bought in the market. MONETARY COMPENSATION AMOUNTS are used to convert the common price for each product into national currencies and to realign prices when the exchange rates of members’ currencies change;
variable TARIFF rates are used to increase import prices to internal price-support levels in the cases of the products referred to above, thus ensuring that EU output is fully competitive. The 25% of EU farm produce that is not subject to direct price-support relies entirely on tariff protection to maintain high domestic prices;
EXPORT SUBSIDIES are used to enable EU farmers to lower their export prices and thus compete successfully in world markets;
grants are given to facilitate farm modernization and improvements as a means of improving agricultural efficiency

The CAP is the largest single component of the EU's total budget. In 2003 it accounted for 45% of total EU spending. Over 90% of the CAP's budget in recent years has been spent on price-support and export subsidies. Although the CAP can claim a number of successes, most notably the attainment of EU self-sufficiency in many food products, critics complain it has many drawbacks: consumers lose out because they are required to pay unnecessarily high prices for food products; resources are misallocated because inefficient, high-cost farmers are overprotected, and too little of the CAP's resources are devoted to long-term structural reform and modernization of the sector; artificially high prices supported by intervention buying encourage gross overproduction and results in large surpluses (‘mountains’) of produce that are expensive to stockpile and difficult to sell off; subsidized exports from the EU can depress world farm prices, making life even more difficult for the less developed countries, many of which (specifically non-LOMÉ AGREEMENT countries) had already been hard hit by the trade diversionary effects of the EU (see TRADE DIVERSION).

However, the CAP has become less protectionist as a result of the ‘Uruguay Round’ of trade concessions (see WORLD TRADE ORGANIZATION). The EU committed itself (over a six-year period starting in 1995) to reduce its import levies by 36%, reduce its domestic subsidies by 20%, and reduce its export subsidies by 36%. Further reductions are currently being negotiated as part of the ‘Doha Round’. See INCOME SUPPORT.

单词	common agricultural policy
释义	Common Agricultural Policy Common Agricultural Policy n (Agriculture) the full name for CAP Translations MedicalSeecap Common Agricultural Policy Common Agricultural Policy (CAP) in the law of the European Union, one of the very foundations, being the legal regime supporting the coordination of agriculture in Europe. Although included in the Common Market, it was necessary to make special provision for agriculture because of the contradictory nature of the policies of some founding member states, made none the easier by the accession of others. The essence of it is that the market is unified, allowing free movement of goods throughout the Community. There is a Community preference protecting the market against imports from outside and the CAP is to be financially secure: the European Agricultural Guidance and Guarantee Fund was set up to this end. Market organizations have been set up for most products, which have the effect of stopping member states from setting up competing systems. The principal effect of the CAP differs in relation to different products: wheat and related produce are protected by intervention purchases made to support producers; beef and related produce are supported by excluding outside competition; and fruit and vegetables and wine are controlled by quality. The intervention price is set as that at which the national authorities must buy certain crops - some farmers may be tempted to grow crops for the intervention price rather than any real market. The more member states become involved in the Union, the more interested they become in reforming the CAP rather than using it as an excuse for complaining. The target price is part of the cereal market scheme. It is the price at which it is expected that sales can be made in the next year in the Union. It is not a fixed price. It is established annually by the Council with a qualified majority on a proposal from the Commission after consulting the Parliament. The threshold price is the price fixed for certain imports from outside countries. It protects Union farmers from outside cheap competition. It is fixed by taking the cost of imports and making sure that it does not exceed the set internal target price. Reforms introduced in 1999 emphasize food safety, environmental objectives and sustainable agriculture. These objectives, which fall outside the scope of market policy, now, with rural development, have become the second pillar of CAP. The reforms in 2003 consist of simplification of market support measures and direct aid by decoupling direct payments to farmers (the aid which they receive is not tied to production); reinforcing rural development by transferring market support funds to rural development through modulation (reductions in direct payments to large farms); a financial discipline mechanism (ceiling placed on market support expenditure and direct aid between 2007 and 2013). In 2004, a second set of initiatives was introduced including: reform of aid to Mediterranean products (tobacco, hops, cotton and olive oil) and a proposal for the reform of the common organization on the market in sugar. Common Agricultural Policy Common Agricultural Policy the EUROPEAN UNION's programme for the subsidization and protection of the farm sector. Common Agricultural Policy (CAP) the policy of the EUROPEAN UNION (EU) for assisting the farm sector. The main aims of the CAP are fair living standards for farmers and an improvement in agricultural efficiency (see AGRICULTURAL POLICY). The CAP is administered by the European Agricultural Guidance and Guarantee Fund, with major policy and operational decisions (e.g. the fixing of annual farm prices) residing in the hands of the Council of Ministers of the EU. The farm sector is assisted in four main ways: around 70–75% of EU farm produce benefits directly from the operation of a PRICE-SUPPORT system that maintains EU farm prices at levels in excess of world market prices. The prices of milk, cereals, butter, sugar, pork, beef, veal, certain fruits and vegetables and table wine are fixed annually and, once determined, are then maintained at this level by support-buying of output that is not bought in the market. MONETARY COMPENSATION AMOUNTS are used to convert the common price for each product into national currencies and to realign prices when the exchange rates of members’ currencies change; variable TARIFF rates are used to increase import prices to internal price-support levels in the cases of the products referred to above, thus ensuring that EU output is fully competitive. The 25% of EU farm produce that is not subject to direct price-support relies entirely on tariff protection to maintain high domestic prices; EXPORT SUBSIDIES are used to enable EU farmers to lower their export prices and thus compete successfully in world markets; grants are given to facilitate farm modernization and improvements as a means of improving agricultural efficiency The CAP is the largest single component of the EU's total budget. In 2003 it accounted for 45% of total EU spending. Over 90% of the CAP's budget in recent years has been spent on price-support and export subsidies. Although the CAP can claim a number of successes, most notably the attainment of EU self-sufficiency in many food products, critics complain it has many drawbacks: consumers lose out because they are required to pay unnecessarily high prices for food products; resources are misallocated because inefficient, high-cost farmers are overprotected, and too little of the CAP's resources are devoted to long-term structural reform and modernization of the sector; artificially high prices supported by intervention buying encourage gross overproduction and results in large surpluses (‘mountains’) of produce that are expensive to stockpile and difficult to sell off; subsidized exports from the EU can depress world farm prices, making life even more difficult for the less developed countries, many of which (specifically non-LOMÉ AGREEMENT countries) had already been hard hit by the trade diversionary effects of the EU (see TRADE DIVERSION). However, the CAP has become less protectionist as a result of the ‘Uruguay Round’ of trade concessions (see WORLD TRADE ORGANIZATION). The EU committed itself (over a six-year period starting in 1995) to reduce its import levies by 36%, reduce its domestic subsidies by 20%, and reduce its export subsidies by 36%. Further reductions are currently being negotiated as part of the ‘Doha Round’. See INCOME SUPPORT. AcronymsSeeCAP
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