This is a graded discussion: 40 points possible due Jun 28 Activation question 2

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This is a graded discussion: 40 points possible due Jun 28 Activation question 2.1, due Thursday The developing world is often overlooked in business courses, as well as the impact trade policies in developed countries have on these nations. Research farm subsidies in the United States, Europe and Australia, and their impact on farmers in the developing world, primarily Africa. Write a short paper (100-400 words) on the ethics on farm subsidies, and on the global movement to reduce these subsidies. Be sure to cite your sources. Copy and paste your answers to the discussion thread Activation Question 2.1. Please comment on the contributions of at least two other students. VSubscribe Search entries or author Unread Reply

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Answer.

An agricultural subsidy is a governmental aid which is paid to agribusinesses, agricultural organizations and farms to supplement their income, manage the supply of agricultural commodities, and influence the cost and supply of such commodities. The subsidies may be offered against crops like cereals, legumes, cash crops like cotton, tobacco, oilseed crops like soybean, sunflower or livestock including cattle, pork, and lamb.

Within the developed countries like the United States, the European Union members, Subsidies serve as an effective way of rationing and targeting subsidy access to maximize production and economic and social gains Within the regional farmers and tradesmen. However, the added benefits to farmers of the developed countries has lead to a serious agricultural crises in the economies of the developing countries which are primarily dependent on the prosperity of their farmers.

Subsidies by the developed countries have resulted in a process known as "international dumping" in which subsidized farmers are able to "dump" low-cost agricultural goods on foreign markets in the developing countries at costs that un-subsidized farmers cannot compete with. Since the developing countries are largely poor economies whose governments find it difficult to ensure a strong subsidy to its farming population. Consequently, the low crop prices on foreign crops encourage developing countries to buy food from wealthy countries. The local farmers, instead of improving the agricultural and economic self-sufficiency of their home country, are forced out of the market and perhaps even off their land. For instance,  Haiti at present does not produce enough to feed its peopl and 60 percent of the food consumed in the country is imported form the United States (IFAD, November 2008).

This has led to a downfall in the agricultural sectors in Countires like India, Pakistan and Indonesia in Asia, Mexico in Latin America, Brazil in Sourh America, Congo, Kenya in Africa, that once relied on the exports of their wheat, rice, corn, livestock, sugar and other commodities, and instead forcing these countries towards a forced scarcity of essential food crops (Patel, 2007). the effects on poverty are particularly negative when subsidies are provided for crops that are also grown in developing countries since developing-country farmers must then compete directly with subsidised developed-country farmers such as in cotton and sugar.

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