Is there any reason to keep the CAP withthe biggest shareof

Is there any reason to keep the CAP withthe biggest shareof the EU budget?
Imagine theEU decides to eliminate the CAP from the budget: What would be the consequences for European firms? What would be the consequences for international firms?

Solution

Common Agriculture Policy (CAP) must be provided biggest share of EU Budget. CAP helps to provide quality agro products to people and keep tab on fluctuations in prices of agro products. Further, it helps to increase exports thereby it generates employments and foreign exchange. Agricultural sector provides essential raw material to firms operating in Europe.

If EU decides to eliminate CAP from budget, it would have some adverse consequences , now firms would no longer be able to procure essential raw material at reasonable rates. thus, these would lose their competitiveness. On other hand, competitiveness of internatinal firms may witness rise since now foreign products may enter European market easily at competitive prices.