The European Union and its agricultural subsidies have created a system called the Common Agricultural Policy (CAP) which roughly represents around 47 percent of EU's budget. Its objective is to create a reasonable standard of living for farmers, provide quality food at a fair price to its consumers and to safeguard the rural heritage ("Common Agricultural Policy," par.1-4).The EU is thus forced to pile their stocks amounting to million of tonnes that are paid above market cost; they have to be stored in mammoth quantities before being injected into the agricultural market of a developing nation. By imposing import tariffs to goods exported by farmers in developing countries, and by undercutting them in their domestic markets where the oversupply is dumped unhindered by any imposed tariffs, the CAP is actually choking business in those countries and in reality, is forcing them back into an economically disfigured subsistence lifestyle ("Common Agricultural Policy,"par.50). So much so that the Human Development Report in 2005 termed CAP as an extravagant plan that is wreaking havoc in global sugar markets.They have also been criticized for creating artificially high food prices throughout the EU. High import tariffs have managed to hinder competition by non-EU producers and it's reported that support to farmers of the OECD countries have cost a family of four about an average of $1000 per year because of rising prices and taxes ("Common Agricultural Policy," par.52). Even though policy makers
in EU argue that they want to help small farms and their small scale production, the CAP has been seen to have aided larger producers more.