The Common Agricultural Policy is Iniquitous and Inefficient. Now, With Brexit, We Can Be Fairer and More Productive
Wednesday, 17 August 2016
Brexit provides Britain with a wonderful opportunity to re-design one of the most ill-thought through policies of modern times argues Shanker Singham, Director of Economic Policy & Prosperity Studies and Chairman of the Legatum Institute Special Trade Commission (Daily Telegraph)
“The Common Agricultural Policy (CAP) hands out subsidies to European farmers, shielding them from healthy competition and hindering the evolution of modern, efficient agricultural methods. The policy leads to overproduction, creating mountains of surplus produce that is either destroyed or dumped on developing nations. Now we have the chance to do things better."
“Subsidies have a profoundly negative effect on developing countries’ agricultural exports, not simply as they put up a barrier to European markets, but also because they lead to overproduction and so lower the prices that producers can get on world markets. As soon as the UK is not bound by the EU’s Common External Tariff, we can also end the scenario whereby farmers in developing countries are incentivised to produce raw material, but not processed goods, where all the value is."
“The discussion we should be having is about how to help Britain’s farmers transition from production subsidies to a highly-specific direct transfer system, allowing farmers to benefit from direct payments for tailored purposes: for example, a fund for remediation of specific environmental problems, or to provide for a research and development tax credit."
Read: The Common Agricultural Policy is Iniquitous and Inefficient. Now, With Brexit, We Can Be Fairer and More Productive
- Legatum Institute Special Trade Commission [View]