EU's Common Agriculture Policy Seen Constraining Trade

The EU should drastically reform its Common Agriculture Policy, rethink its bilateral trade deals and push harder for a Doha deal at the WTO, according to a prominent Brussels think-tank.

The EU should drastically reform its Common Agriculture Policy, rethink its bilateral trade deals and push harder for a Doha deal at the WTO, according to a prominent Brussels think-tank.

The new report from the European Centre for International Political Economy launches a scathing attack on the CAP, which is singled out as the main constraint to the EU leading a more pro-active trade policy.

The report is authored by the think-tank's new Trade Policy Study Group, which is made up of executives from Ericsson, IBM, Nokia, Nestlé and other multinational companies.

The report argues that it is in the EU's interest — as the world's biggest trading bloc — to revive the "magnificent" waves of liberalization that helped free up global trade in the 1980s and 1990s. It also warns that the first decade of the 21st century has yielded little further progress, while the recent recession has sparked steps in the opposite direction.

"Few things constrain Europe's ability to lead globally as much as its program for agricultural subsidies and high tariffs on agricultural import," the group said, and advanced industrial and services sectors in Europe are said to pay a high price for this protection.

"If Europe is not prepared to give improved market access to exports of agricultural produce, these exporters will maintain barriers against Europe's industrial and services firms," the report says.

The report, in PDF format, is available at this site.

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