PRESS
RELEASE - African, Caribbean and Pacific
(ACP) countries express extreme dissatisfaction with EU sugar reform
proposals and accompanying measures – Reform too fast, too deep,
too soon
Brussels, 22 June 2005 –
ACP sugar supplying countries today
stated their strong concern with the European Commission’s planned
reform of the EU Sugar Regime. The ACP were responding to the publication
of a legislative proposal to overhaul the existing regime by slashing
raw sugar prices by 39% over a period of only four years.
The Commission’s proposal would have a crippling
effect on the economies of ACP countries traditionally supplying sugar
to the European Union under the provisions and guarantees of the ACP-EU
Sugar Protocol. In addition to price cuts, the proposal would also
impose new marketing restrictions on ACP suppliers, against the spirit
and letter of the Sugar Protocol.
“It is impossible to overstate the devastating
impact the price cuts and timescale proposed by the Commission will
have on ACP countries. As far as the ACP is concerned, the proposed
reform is too fast, too deep, and too soon,” said Clement Rohee, Minister
of Foreign Trade of Guyana and Ministerial spokesperson on sugar for
the Caribbean Community (CARICOM). “Under these conditions
the sugar industries in many countries will be simply unable to survive,
while in other producing countries the so-called reform will inevitably
lead to severe cutbacks with disastrous socio-economic consequences.”
Preferential access to the EU market under the terms
of the Sugar Protocol is of vital importance to the economies of ACP
states – in some
cases it is the single highest contributor to gross domestic product.
For the ACP a loss in income of up to €400 million annually can
be expected from the proposed reform, when the daily earnings per capita
in some ACP countries are less than €2 per day.
ACP sugar producing countries therefore urge the EU Member
States to agree to considerably less drastic price cuts that would be
gradually phased-in over a period of eight years as of 2008 along with
accompanying measures to support the restructuring and modernization
of ACP sugar industries. The ACP preference is for putting the focus
on maintaining sustainable development through trade rather than creating
another aid mechanism.
The Sugar Protocol is a legally binding intergovernmental
agreement with obligations to be met by all contracting parties. The
ACP has faithfully met its obligations and should reasonably expect the
EU to respect its commitments enshrined in the Protocol in terms of the
three guarantees of price, access and indefinite duration. However, continuing
access to the EU market without remunerative prices is utterly meaningless
and unsustainable for ACP sugar supplying states, as it also is for the
Least Developed Countries (LDCs).
“The European Commission has provided countless
assurances that it will stand by its commitments to ACP countries,” said
Mr. Kaliopate Tavola, Minister for Foreign Affairs and External Trade
of Fiji. “Regrettably, however, the Commission’s proposal
does not take our situation into account in any way. It is completely
at odds with EU development policy, the general objectives of the Doha
Development Round of the WTO, and the pursuit of the UN Millennium
Development Goals.”
Sugar has traditionally played an important multifunctional role in
the socio-economic fabric of ACP producing countries. In addition to
providing employment to hundreds of thousands of people, a wide range
of other direct and indirect benefits are derived from the sugar industry,
and in most cases there are very limited possibilities to diversify away
from sugar for inherent climatic, topographic and geographic reasons.
The ACP countries are working to modernise and enhance
the competitiveness of their sugar industries in a changing global
environment. However, in order to maintain the thrust of restructuring
efforts already underway, ACP producers must be able to rely on the
EU to meet their legitimate expectations under the Protocol and the
Cotonou Agreement. “The
solution for ACP states must comprise a lower price cut spread over a
longer timeframe supported by accompanying measures that will ensure
the long term sustainability of the sugar sector”, stressed
Felix Mutati, Deputy Minister of Finance and National Planning, Zambia
.
In this context, the UK Government has recently stated
that at least €500
million in transitional assistance will need to be made available to
the ACP to offset the projected losses from cuts to the internal EU sugar
price.
“In order for the Commission’s accompanying
measures to have any positive effect, it is absolutely essential
that funding is made available up front in 2005,” said
K.D Knight, Minister of Foreign Affairs and Foreign Trade of Jamaica. “Any
delay will make it impossible for our industries to adapt in time
to absorb the impact of price cuts.”
Minister Knight added, “What we very much
want to avoid is a repeat of past mistakes in the banana, rum and
cocoa sectors, where EU financial support programmes have been of
little or no effect. What we need are dedicated commercial funds
that will reach the producer on the ground.”
The ACP countries accept the need for the reform
of the EC sugar regime. However, they want a reform which is fair and
equitable to all stakeholders and one which complies fully with the
legal and political commitments of the EU vis-à-vis the ACP
sugar supplying states enshrined in the Sugar Protocol.
For editorial information, please do not hesitate to contact:
Nidhendra Singh
Tel: +32 (0) 475 369265
Giles Keane
Tel: +32 (0) 473 894328
Background
Document - The ACP Countries and the reform of the EU Sugar regime
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