Cap Policy

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CAP Policy

CAP Policy


This review will be discussing on the overall and specified terms reflecting to the Common Agricultural Policy (CAP) and its key play roles performed in context by EU (European Union) for its effectiveness and well being of establishment and performance. The discussion will specifically focus on the rationales for the establishment of Common Agricultural Policy (CAP), the main factors that have played a role in its reforms, and the main characteristics of its reforms and the reasons why the CAP have been slow in coming years after all this.


The Common Agriculture Policy (CAP) had established following the World War II as element of the Roman Treaty which came into formation and signed in 1958. One of the main products that were used for trade and distribution within the European Union (EU) countries was olive oil. One of the prime objectives of the CAP under obligation of the EU was to promote olive oil produced from all the countries falling in the EU membership.

The Rationale for its Establishment

After the World War II worldwide shortage, EU began to discover ways to develop into a self-sufficient food and agricultural producer of the region. The Rome Treaty put the phase for the CAP by defining certain marketplace along with providing a fair price strategy for agricultural farmer to access the global market and gain its competitiveness.

The CAP came was finally established after development of competitiveness framework in 1963. However, CAP establishment was based on four principles:

One was an establishment of an integrated trading for complimentary transport of agricultural goods in the EU enclosed via society partiality.

Second principle was establishment of financial commonality. This meant that all costs incurred towards the CAP were to be funded by a joint treasury, EFOAG (European Fund for Orientation and Agriculture Guarantee), maintained by imported duty and assistance from EU member nations.

Third principle was establishment of CAP based on society preference. EU members' goods were to be given more favor over any other imported goods from other countries.

Fourth and the last principle were establishment of equality and productivity of the members of EU. Revenues made by the farmers had to be equivalent to revenues generated by different segment, having rational costs in order to allow food admittance to the buyer.

Factors That Played a Role in Cap Reform

There have been many factors which played a key role in reformation of CAP in the time ...
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