Press review - 731 - Revue de presse : 20/07/2005
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EU SUGAR
Thousands of sugar beet farmers descend on Brussels
Source: EU OBSERVER
18.07.2005 - 17:44 CET Thousands of sugar beet farmers descend on Brussels
By Meghan Sapp EUOBSERVER / BRUSSELS - More than 6,000 farmers from over 20 countries gathered in Brussels Monday (18 July) driving their tractors and waving their sugar beets, but their cries are likely to have fallen on deaf ears.
Amidst the whistles and protest chants in a dozen languages, the majority of the EU farm ministers discussing the sugar reform plans for the first time in Brussels on Monday (18 July) tended to be in favour of the deep price cuts.
EU agriculture commissioner Mariann Fischer Boel unveiled plans last month that would slash support prices for sugar by 39% over two years - ministers are hoping to reach agreement by November.
Swedish agriculture minister Ann-Christin Nykvist told reporters at the protest that the Commission's proposal was "radical, but needed."
She said farmers were protesting at home, aware that her views on reform were contrary to theirs, yet she did not think the protest in Brussels would bring any new light to the debate.
German agriculture minister Renate Künast, a long-time supporter of reform, told the crowd, "I understand your concerns, but reforms will happen. Farmers must show that they can cope responsibly with tax money".
Farmers were quick to boo and heckle when she said that Brazil, the world's largest sugar producer, had the right to export to the EU. Farmers are trying to convince ministers they have the right to grow sugar.
From banners saying "I *heart* sugar" to t-shirts and hats bearing a fighting sugar beet, farmers stood alongside a funeral hearse bearing sugar beets while Ms Künast stood on stage next to a guillotine.
Concern for the little guys
Farmers in the outlying areas of the EU, especially Finland and Portugal, are concerned that price cuts will affect them more deeply than farmers in other regions.
Of the 700 sugar beet farms in Portugal, five farmers came to make their voices heard in Brussels. The reform proposal would represent a 70 percent cut in income to farmers with as many as 1,500 jobs losses, according to the Portugese sugar beet farmers association's vice-president Gabriela Cruz.
The seven representatives from Finland were quick to point out that their country never produced more sugar than their quota, so were not contributing to the problem of excess EU imports. The EU has come under fire by the WTO for exporting more subsidised sugar than allowed.
Instead, the Finns worry about what they will do once sugar beet is no longer an option as many areas are too cold for other crops, according to Finnish farmer's union sugar beet chairman Pekka Myllamäki.
Farmers from Africa, Caribbean and Pacific countries came out to support their European brothers as well.
"The price cuts are unsustainable for any country," said Géo Govinden of the Mauritius Sugar Syndicate. "Imagine if this were the European auto industry."
Fears over Brazil
The reform proposal will attempt to stem the EU's four million tonnes of annual sugar exports while leaving only the most efficient sugar producers in business. Some say the reform may work too well, forcing the EU to import sugar to make up for the shortfall in consumption.
Others are concerned Brazil will funnel sugar through the Least Developed Countries (LDCs) who have unlimited duty free access to the EU market after 2009 as part of the Everything But Arms initiative.
Brazil currently exports very little sugar to the EU because of high tariffs.
Many LDCs will be unable to ship their own sugar to the EU after the price cuts, despite favorable access. But many, including LDCs themselves as well as EU sugar beet farmers, worry about unscrupulous sugar traders looking for easy money made easier by a reform that has no protection mechanisms.
Ms Fischer Boel told reporters Monday that the Commission will watch imports carefully for sugar's country of origin.
"We are very aware of the production capacities of the LDCs," Ms Fischer Boel said.
Insiders expect this first meeting to just be an exchange of views by member states where no real negotiating takes place
LIBERIA
European Commission grants funds to liberalize Liberia's power grid
Source: CHINA VIEW
2005-07-19 21:27:30 European Commission grants funds to liberalize Liberia's power grid
MONROVIA, July 19 (Xinhuanet) -- The European Commission is to provide an initial grant of 6.5 million euros (about 7.8 million US dollars) to help Liberia to liberalize its state-run electric power sector which has been paralyzed for 15 years due to the civil war.
According to the European Commission (EC) office here Tuesday, the process leading to the liberalization, which would require thesupervision of external technical assistance, is a result of a "management study" from which a "strategic decision has been made by the Liberian government to liberalize the electric power sector," beginning with the capital Monrovia.
The EC has therefore put up the project for tender, from August15 to the end of October this year. The African Caribbean Pacific (ACP) and European Commission (EC) partnership agreement signed in Cotonou, the capital of Benin on June 23, 2005, has been cited as the "legal basis" upon which the electricity grid for Monrovia would be reconstructed.
The project is being viewed as a future sign of relief to investors. The investment climate in the country is strenuous due to the lack of a national grid for which almost all businesses provide their own power supply, thereby making investment more cost intensive due to the rising price of fuel.
However, the liberalization of the electric power sector in thecountry could raise concerns in some quarters in that the liberalization process is seen as a step toward privatization of the sector.
A privatization of the sector would most-likely lead to higher consumption cost which the ordinary citizens, most of whom live below the poverty line, would not afford.
Already, there are on-going discussions between the Liberian government and its international development partners regarding a proposed private management and operation of strategic sectors in the west African country which could include the electricity sector. Enditem
FIJI
Tuisese stresses alternative crops
Source: FIJI TIMES
(Wednesday, July 20, 2005) Tuisese stresses alternative crops
THE Ministry of Agriculture is advising cane farmers to look for optional cash crops to plant and gain a livelihood as sugar prices begin to decline.
"There are profitable crops that farmers can choose to plant or invest in with the current situation facing the sugar industry," Agriculture minister, Ilaitia Tuisese said yesterday.
He said the ministry and the Fiji Sugar Corporation were working with cane farmers to look for alternative crops and investments to sustain farmers' earnings and livelihood.
Mr Tuisese and officials from the ministry and FSC will hold a three-day tour of Nadroga province, beginning today to brief cane farmers on the Alternative Livelihood Project (ALP).
"In view of this impact on their livelihood, government has come up with ALP to offer and increase opportunities available for on and off farm employment and sustainable livelihoods in the cane areas and the surrounding rural areas and urban areas," Mr Tuisese said.
He said cane farmers were aware of the decline in sugar prices for Fiji and other Asian Carribean Pacific countries and need to act accordingly.
WORLD BANK /DEVELOPMENT
Bank Increases Lending to Developing Countries
Source: EAST AFRICAN STANDARD (Kenya)
July 19, 2005 Bank Increases Lending to Developing Countries
Tom Mogusu
Nairobi
World Bank's lending to developing nations rose to US$22.3 billion in 2005, up from US20.1 billion in the previous year.
The increased funding was partly a result of deliberate efforts to harmonise delivery across development agencies.
The bank has cut the fragmentation of its projects and eliminated duplication.
It says its 279 projects worldwide benefited from a funding increase of US$2.2 billion over the previous year.
Out of the total amount spent, US$13.6 billion was channelled towards middle-income countries through the International Bank for Reconstruction and Development (IBRD).
The bank said a further US$8.7 billion was mostly in the form of no-interest loans or grants to the poorest countries through the International Development Association (IDA). This covered 161 projects.
"By comparison, total lending commitments were US$20.1 billion in 2004, including US$11 billion from IBRD, and US$9 billion from IDA," it says.
While the volume of new lending was on the increase, overall lending quality also rose during the period.
"There was a steady improvement in the quality of ongoing projects through better preparation, greater selectivity and more effective supervision that has resulted in more effective utilisation of IBRD/IDA assistance," a report by the bank says.
It indicates that the share of total outstanding commitments at risk of not achieving development objectives also dropped to 13.5 per cent during the review period, up from 15.9 per cent in the previous year.
Disbursements increased to US$18.7 billion in FY2005 from US$17 billion in the previous year.
Europe and Central Asia received US$4.1 billion, Africa (US$3.9 billion).
East Asia/Pacific (US$2.9 billion) and Middle East and North Africa (US$1.3 billion).
ILE MAURICE
ACP sugar producers take to the streets in Brussels
Source : L'EXPRESS (ILE MAURICE)
Article publié le Mardi 19 juillet 2005. ECONOMIC CRISIS
ACP sugar producers take to the streets in Brussels
The ACP/Mauritius group was among the demonstrators at the rally in Brussels. “We just want to be treated fairly,” stressed Christian Foo Kune.
The European Union (EU) Agriculture ministers met yesterday in Brussels to discuss the sugar reforms proposed by commissionner Mariann Fischer Boel earlier in June. The Mauritian side has, up to now, left no stone unturned to express its concern about the forthcoming drastic price cuts.
Whilst Agro-industry minister Arvin Boolell was lobbying at all levels in Brussels last week, stakeholders of the local sugar industry have taken to the streets alongside European beet sugar producers to protest against the reform plans of the European commission. “We need to tell the EU that such price cuts would be disastrous for ACP countries”, stressed Jacques d’Unienville, president of the Mauritius Sugar Producers’ Association. Christian Foo Kune, president of the Chamber of Agriculture, Lutchmun Roy, president of the Plantation Workers’ Union, and Greedharry Jugessur, a small-scale planter, are part of this delegation, whose participation in the demonstration has been approved by the government.
Last Wednesday, minister Boolell made a concise and forceful statement at the hearing of the European parliament on the reform of the EU organisation for sugar. As spokesperson of the 18 ACP countries, signatories of the Sugar Protocol, he stressed that the present reform has a bitter taste.
More than a simple trade agreement, Arvin Boolell said, the Sugar Protocol is part of the ACP culture, having contributed to political emancipation and guaranteed social stability and mobility. “The proposed drastic cuts in the sugar price do not go in that direction and, if adopted, they will threaten the already precarious livelihood of our poor farmers and workers who do not have an alternative source of income.”
Arvin Boolell explained that the 39% cut cannot be justified by mere reliance on WTO rules. “Neither the WTO Panel and Appellate Body rulings nor the 2004 WTO July Framework Agreement on Agriculture require a drastic cut in price of 39% over a short period. If upheld, it will cripple our vulnerable economies. This is unjust and unacceptable for the ACPs.”
Since the inception of EU sugar reform negotiations, ACP countries have been asking for less drastic price cuts starting from 2008 onwards. Producing sugar at lower prices will entail further reforms in Mauritius. However such reforms will not be possible if sufficient funds are not made available. Up to now, only Great Britain, current chair of the EU, has come up with satisfactory financial proposals, some 500 millions euros per year.
Crippling effects
On this issue, minister Arvin Boolell said, in his concluding remarks: “All financial resources should be provided upfront to the ACP states concerned so that they can prepare to adapt to the reform proposals and thus improve the competitiveness of their sugar industries in order to operate in a post reform situation.”
The crippling effects of the sugar reforms were also discussed last week at the House of Commons. MPs have shared similar views expressed earlier on by ACP countries.
Kamlesh BHUCKORY
ILE MAURICE
L'industrie sucrière manifeste à bruxelles
Source : L'EXPRESS (ILE MAURICE)
Publié sur le web le 18 Juillet 2005 . L'industrie sucrière manifeste à bruxelles
Kamlesh Bhuckory
Port Louis
La participation est symbolique mais non moins importante. Quatre représentants de l'industrie sucrière défilent aujourd'hui, affichant le quadricolore, dans les rues de Bruxelles. Le but est d'exprimer leur désaccord avec la baisse du prix garanti du sucre sur le marché européen.
La délégation, qui se trouve dans la capitale européenne depuis hier, est composée de Jacques d'Unienville, président de la Mauritius Sugar Producers' Association (MSPA), Christian Foo Kune, président de la Chambre d'Agriculture, Lutchmun Roy, syndicaliste de la Plantation Workers' Union et Greedharry Jugessur, petit planteur.
"L'objectif de notre participation est de faire passer le message que la baisse sera catastrophique pour les Etats-membres du bloc Afrique, Caraïbes et Pacifique (ACP)", affirme le président de la MSPA. Il ajoute que la présence mauricienne sert également à expliquer que cette réduction transformerait le Protocole sucre en un "instrument d'instabilité et de pauvreté". La partie locale aura la possibilité d'interagir avec la presse européenne pour véhiculer ses craintes et attentes au niveau de l'Union européenne.
Cette manifestation se déroulera au même moment que le Conseil européen des ministres de l'Agriculture. Ce dernier se penchera, pour la première fois, sur la réforme du régime sucrier proposé par la commissaire Mariann Fischer Boel. Dans l'ébauche du texte législatif publié le 22 juin, elle préconise une baisse de 39 % du prix du sucre produit par les ACP (dont Maurice) et les betteraviers européens.
L'événement est organisé par la Confédération internationale des betteraviers européens, qui ont invité leurs homologues des ACP pour que les récriminations soient transmises d'une voix commune. D'ailleurs, le gouvernement mauricien a donné son accord à cette participation.
TITLE
COUNTRY
Source: FINANCIAL TIMES (UK)
Published: July 18 2005 18:05 | Last updated: July 18 2005 18:05 Market insight: world tastes sugar high
By Kevin Morrison and Neil Dennis in London
The sugar market has hit a sweet spot. Refined sugar prices in London rose to a seven-year high last week as strong demand outstripped supply.
And traders say prices have yet not peaked, with speculators building large long positions in betting sugar will rise further.
The spike in the prices of contracts to deliver sugar in August were driven by tight supply. Brazil, the world’s largest sugar producer, and the European Union already sold their sugar output for August, and the impact of this was compounded by unexpected demand from Pakistan and Iraq.
The August white sugar futures price in London rose to $324 a tonne on Thursday, its highest level since September 1997. The Thursday peak represented a 27.5 per cent rise since the start of the year and a 70 per cent advance since the end of 2003. The next deliverable contract, October, was yesterday trading at $285.90 tonne, $38 below the August peak. But traders say that although the front-month spike was not sustainable, it does not mean sugar prices have peaked.
Czarnikow Sugar, the London-based commodity trader, estimates that global sugar demand will rise to 148.15m tonnes this year, up about 12m tonnes from 2002. Some of this rise in demand was attributed to ethanol production in Brazil where the sale of “flex-fuel” cars, which are able to operate on either petrol or ethanol, account for about one-third of new car sales.
Toby Cohen, head of research at Czarnikow, says ethanol demand accounts for about half of Brazilian sugar cane production, which is estimated to reach almost 29m tonnes this year and is up by almost two-thirds from four years ago.
Meanwhile, Pakistan is importing sugar faster than usual as domestic prices have risen more than 15 per cent in the past two months after a drought cut cane sugar production in 2004 by 21 per cent. On Sunday, the Trading Corporation of Pakistan, a government agency, confirmed it had bought 100,000 tonnes of white sugar for delivery in August and September.
Another factor for the higher sugar price is that demand has exceeded supply for the past two years. And this tightness in supply has attracted speculators.
The latest data from the US last week showed that speculators betting on continued price rises lifted net long positions by 18,130 to 96,327. Given that on May 10 the market was net short by 34,458 contracts, the swing reflects how investors have developed a sweet tooth for the product.
However, Mr Cohen says the market will return to surplus next year, because EU producers are expected to have their last big production surge before reform of the region’s system of protecting sugar growers comes fully into effect. The EU plans to slash its white sugar support price by 39 per cent over two years starting 2006-07. The plans follow a successful challenge to the EU’s price support system at the World Trade Organisation.
“We will see a final push by European growers to produce as much beet as they can,” Mr Cohen says.
But the EU reform will lead to lower production in Europe from 2007 onwards, while sugar demand is expected to increase. EU countries are estimated to produce 21.16m tonnes this year, and this could rise by another 1m next year, before falling by up to 5m tonnes from 2007.
“I think we might see a dip in prices next year, before resuming upwards in the longer term,” says Mr Cohen.
JAMAICA
FIRE THEM! - Golding wants sugar bosses sacked; cites gross neglect
Source: THE JAMAICA GLEANER
published: Wednesday | July 20, 2005 FIRE THEM! - Golding wants sugar bosses sacked; cites gross neglect
Omar Anderson, Gleaner Writer
OPPOSITION LEADER Bruce Golding yesterday called for the sacking of the entire Sugar Company of Jamaica (SCJ) management because of what he said was its incompetence in managing the affairs of the country's sugar industry.
Speaking in the House of Representatives in response to Prime Minister P.J. Patterson's answering of his questions on the fate of the sugar industry, the Opposition Leader said there was gross neglect of duty by the SCJ.
INCOMPETENCE
Citing what he said was "one example of incompetence that has plagued the industry", Mr. Golding said last year June, 12 rollers at the Monymusk Sugar Factory needed to be replaced. He claimed, however, that a purchase order was only issued in October, four months after the end of the sugar crop and three months before the start of the next crop.
"I can give you a list of similar examples and I really want to ask the Prime Minister whether the interest of Jamaica can be served by the continued retention of the existing management of the Sugar Company of Jamaica," he queried.
SENTIMENTS ENDORSED
In response, Mr. Patterson said matters pertaining to the portfolio responsibilities of individual ministers should be addressed by the respective minister.
Yesterday, Allan Rickards, chairman of the All Island Jamaica Cane Farmers' Association (AIJCFA), said his organisation endorsed Mr. Golding's sentiments.
"Mr. Golding's comments reflect the feelings of the cane farmers across the country who are not prepared to go forward with this same SCJ management," he told The Gleaner. Livingstone Morrison is the chief executive officer of the SCJ. Efforts to reach him yesterday were unsuccessful.
INVITATION FOR TALKS
Mr. Patterson yesterday extended another invitation to the Oppo-sition to discuss a report on the future of the country's ailing sugar industry, in light of the completion of another report by the Planning Institute of Jamaica (PIOJ).
His invitation came a month after the European Commission (EC) said it would reduce by more than 39 per cent, the price for sugar exported to Europe by African, Caribbean and Pacific, (ACP) countries.
"From the time of the Henriques Report, I invited the Opposition to be privy and to contribute to the work and study that needed to be published," the Prime Minister said.
"That invitation was not accepted then, I extend the invitation once again."
In 2001, a task force, headed by Marjorie Henriques of the Ministry of Finance and Planning, recommended major restructuring of the sugar industry, including mergers and closures.
The Prime Minister said the future of the local sugar industry would be known by October this year when he makes a detailed statement to Parliament.
EU/ACP
Sugar farmers join protest at EC cuts
Source: GUARDIAN UNLIMITED (UK)
Monday July 18, 2005Sugar farmers join protest at EC cuts
David Gow in Brussels
Thousands of European sugar beet farmers will today press EU ministers to water down proposals to slash prices by 39% and axe 25,000 jobs.
The demonstration, joined by sugar cane farmers from the Caribbean, comes as farm ministers meeting here face serious splits over European commission plans to end export subsidies and over-production.
The commission wants to cut the cost of the €1.7bn (£1.1bn) support system for beet farmers by cutting prices by 39% over four years from 2006, offering 60% compensation to farmers to give up producing.
Developing countries, which want less drastic price cuts spread over eight years, have warned ministers that the proposed reforms will cause devastation for their economies, some of which rely on sugar for 70% of national output.
Last week Arvin Boolell, Mauritian agriculture minister, said the price cuts would cost his country €100m a year and urged ministers to adopt more generous compensation for developing countries' farmers than the €40m on offer.
Robert Sturdy, a Tory MEP and beet grower, said: "Farmers are coming together to say that this reform, which will benefit a handful of Brazilian sugar barons and multinational companies, is bad for consumers, bad for the environment and bad for farmers."
Brazil led complaints at the World Trade Organisation which last year ruled EU export subsidies illegal, but Mr Sturdy said the world's biggest sugar-producing country threatens to take over the EU market.
UE
Les betteraviers se mobilisent contre la réforme de l'industrie sucrière prévue par l'Union européenne
Source: LE MONDE
19.07.05 | 13h21 • Mis à jour le 19.07.05 | 13h21 Les betteraviers se mobilisent contre la réforme de l'industrie sucrière prévue par l'Union européenne
BRUXELLES de notre bureau européen
lus de 5 000 betteraviers ont manifesté, lundi 18 juillet à Bruxelles, afin de protester contre la réforme de l'industrie sucrière européenne, tandis que les ministres de l'agriculture examinaient le projet présenté voilà un mois par la Commission.
Mariann Fischer Boel, la commissaire chargée de l'agriculture, suggère de réduire de 39 % en deux ans le prix de la tonne de sucre. Sans remettre en question les quotas actuels, le nouveau dispositif vise à réduire la production de quelque 5 millions de tonnes sur quatre ans. "Il n'existe aucune alternative à une réforme en profondeur" , a estimé Mme Fischer Boel, qui espère, avec la présidence britannique de l'Union, boucler la réforme d'ici novembre.
Pour elle, les industriels du sucre européens ne peuvent plus prospérer dans un univers ultra-protégé, selon des règles inchangées depuis 1968. A 632 euros la tonne, les prix garantis au sein de l'Union sont actuellement trois fois et demi supérieurs aux cours mondiaux. Les betteraviers sont protégés de la concurrence extérieure par des droits de douane dissuasifs.
FERMETURES DE RAFFINERIES
Ce double avantage leur permet d'écouler leurs excédents à bas prix sur les marchés mondiaux, avec ou sans subventions, suscitant une concurrence jugée déloyale pour les pays en développement. En septembre 2004, le dispositif européen a été partiellement condamné par l'Organisation mondiale du commerce (OMC), après une plainte déposée par le Brésil, la Thaïlande et l'Australie. Le jugement a été confirmé en appel en avril.
Italie, Espagne, Finlande, Grèce et Irlande, inquiètes pour leurs producteurs, ont dénoncé lundi les modalités de la réforme. La France, l'Allemagne et le Royaume-Uni soutiennent au contraire le projet de la Commission, qui souhaite privilégier les régions de production "naturelles", alors que les aides ont stimulé la production sucrière dans les pays du nord de l'Europe et du pourtour méditerranéen. La Commission mise sur le volontariat. Des aides dégressives seront versées aux raffineries s'engageant à fermer leurs portes dans les quatre ans (730 euros par tonne la première année, 420 en 2009).
Bruxelles prévoit de compenser à hauteur de 60 % le recul des prix garantis par des aides directes. Le prix de la tonne de sucre restera au-dessus des cours mondiaux, mais il doit tomber à 385,5 euros en deux ans.
La réforme suscite aussi des réactions mitigées parmi les partenaires commerciaux de l'Union, qui ont longtemps prospéré grâce à la générosité du dispositif européen. Les pays ACP (Afrique, Caraïbe, Pacifique) s'inquiètent de voir remis en question les prix garantis dont ils bénéficient au même titre que les producteurs européens. "Il faut nous laisser le temps et nous donner les moyens pour diversifier nos activités et adapter notre industrie" , dit Clement Rohee, le ministre du commerce extérieur du Guyana.
Pour la seule année 2006, 40 millions d'euros sont prévus pour financer la transition.
Philippe Ricard
Article paru dans l'édition du 20.07.05
EU TRADE
EU optimistic about passage of sugar industry reform
Source: AGENCE FRANCE PRESS
Mon Jul 18, 2:47 PM ETEU optimistic about passage of sugar industry reform
EU agriculture commissioner Mariann Fischer Boel expressed optimism she would win support for a controversial sugar industry reform, as thousands of sugar producers hit the streets of Brussels.
Boel said the planned reform, which European sugar makers believe will endanger their livelihoods, is vital to save the industry.
"I don't see any significant majority against," she told reporters after it was presented to EU farm ministers for the first time. "There are more votes for, than against this proposal today."
"If we do not do anything then the whole sugar production in Europe will suffer a slow painful death, that's for sure," she said.
The reforms became necessary after the World Trade Organization (WTO) declared current EU policies, which date back to 1968, illegal based on a complaint from Australia, Brazil and Thailand.
At the moment, the EU offers a guaranteed price for sugar that is paid for, in effect, by consumers, with Brussels buying from producers at about three times the average world market price.
The European Commission's plan is to cut the guaranteed price by 39 percent over two years from 2007 and offer a voluntary compensation scheme for producers forced out of business by the price cut.
It hopes to get the go ahead for its plans by November.
"Of course it is not a surprise that a few ministers expressed their doubts on the sustainability of cutting the prices so deeply, as we have proposed," Fischer Boel said.
"This is the first political discussion that we've had in the council and I was very much encouraged," she said, but refused to reveal how many of the EU's 25 members were against the plans.
But an official close to the dossier said that the position among the ministers had hardened against the reforms, with a total of 10 states now opposing them.
Previously eight members had formed a blocking minority against the plans: Estonia, Finland, Greece, Italy, Ireland, Lithuania, Portugal and Spain.
Fischer Boel said it was important to have a result when she travels to Hong Kong in December for the next WTO summit.
Meanwhile between 6,000 and 8,000 producers from 21 European countries gathered nearby to make sure their voices were heard.
"What future for us?" read one placard brandished by the demonstrators, whose protest remained calm as EU farm ministers met to discuss the proposals.
"The reform will only be good for a few multinationals who dominate the sugar market and it will be negative for European farmers," said Roger Saenen, spokesman for the Flemish Boerenbond agriculture union.
The plans are also likely to hit the sugar sector in 18 African, Caribbean and Pacific countries, so-called ACP countries, which also benefit from the preferred price system.
They claim they will lose 400 million euros (480 million dollars) a year.
"It will push us into poverty and bankruptcy," Christian Foo Kune, speaking on behalf of the ACP group, told AFP.
In the package, the commission is offering 40 million euros to help ACP producers but the funds will go nowhere close to recuperating industry losses.
CARIBBEAN
Latin America shows no concern for the Caribbean
Source: CARIBBEAN NET NEWS
Tuesday 19 July 2005
COMMENTARY
Latin America shows no concern for the Caribbean
by Sir Ronald Sanders, a former Caribbean diplomat, now corporate executive, who publishes widely on small states in the global community
Tuesday, July 19, 2005
On July 7th seven Latin American countries held a meeting in Costa Rica in which they showed no concern for the calamitous effect on CARICOM economies of a further loss of their preferential market in the European Union (EU) for bananas.
The Presidents of Colombia, Costa Rica, Ecuador, Guatemala and Panama, and representatives of the Presidents of Nicaragua and Honduras declared that a new tariff on their banana exports which is being proposed by the EU for January 1, 2006 discriminates against them.
What is troubling is that the seven countries actually named the present access for bananas by African, Caribbean and Pacific (ACP) countries to the EU market as harmful to them, and indicated their firm intention to fight it.
The Latin countries are emboldened in this by the fact that US multi-national corporations own many of their banana plantations, and both the present government of President George W Bush and the previous administration of Bill Clinton sided strongly with them in challenging ACP preferential access to the EU market.
Arbitration panels of the World Trade Organisation (WTO) have ruled that the Treaties under which the EU gives ACP countries preferential treatment contravene free-trade rules by discriminating against Latin American “dollar” bananas.
The next test of the Latin American fight will come in a few weeks time, around August 1st, when an initial ruling is expected by a WTO Panel on the EU proposal to place a single tariff of 230 Euros per metric tonne on all banana imports with no limit on volumes from January 1st, 2006.
At the moment, under existing agreements with the EU, ACP countries enjoy a duty-free quota of 750,000 tonnes; beyond the quota a tariff of 380 Euros is paid.
The EU proposal for a single tariff of 230 Euros per metric tonne does not please ACP countries either.
They firmly believe that once their existing duty-free quotas are removed “imports will increase dramatically and prices will fall as traders fight to increase market share”. They would have preferred a higher tariff to be applied to bananas from non-ACP countries to allow them to maintain their share of the EU market, particularly as the Latin American counties produce less expensive bananas largely because of cheap labour costs.
At their meeting in Costa Rica, the Latin countries declared that “the tariff of 230 euros per metric tonne does not guarantee the maintenance of total access for bananas coming from Latin America”, and they “consider it unjustifiable that at the Doha round (trade negotiations of the WTO) the European Commission denies the commercial opening to banana exports coming from Latin American developing countries”.
But, Caribbean banana exports are small in relation to the exports of the fruit from Latin America.
Further, for several Caribbean countries especially Belize, Jamaica and the Windward Islands of Dominica, St Lucia and St Vincent & the Grenadines, the EU market for bananas is essential for their survival. In Belize for instance, banana production and related industries account for about 10% of total employment, and there is no alternative employment for the 10,000 people dependent on these jobs. Similarly, in Jamaica approximately 10% of the total labour force is reliant on the banana industry and its related sectors.
And, while tourism has recently been making a greater contribution to St Lucia’s economy than before, that island still relies heavily on banana exports as does Dominica and St Vincent & the Grenadines. In fact, in the latter two countries, the export of bananas to the EU is crucial to their survival in absolute terms.
In this context, the attitude of the Latin countries poses a real threat to these five countries of the Caribbean Community and Common Market (CARICOM) and to its other member states as well. It has to be recalled that declines in the economic performance of one CARICOM country affects all of them.
The seven Latin countries have asserted that “social, economic and political stability depend to a great extent” on their efforts to incorporate their economies into world trade and this includes exporting their bananas to the EU without restriction. They also claim that exports of bananas would allow for “abandoning crops from which illicit drugs are made”.
These arguments are perhaps more valid for the five affected CARICOM countries than they are for the Latin countries precisely because the level of reliance by the CARICOM countries on exports of bananas to the EU is far greater than it is for Latin America. The potential for social, economic and political stability is much more real and immediate for small CARICOM states than it is for larger Latin ones.
What is more, great efforts have been made by the banana-producing CARICOM states to improve the efficiency of the banana industry and, indeed, to diversify their economies. But, even as this commentary is being written, it is already known that income from the export of sugar by Belize, Jamaica and other CARICOM countries to the EU will be reduced by 39%. Unemployment will rise and social unrest will surely follow.
Latin America and the Caribbean may be classified as one group in the international system, particularly within the United Nations framework, but the level of understanding and sympathy for the Caribbean from Latin America is practically non-existent.
All this having been said, Caribbean countries should not expect the Latin Americans to ease their pressure on the EU. They want a new tariff on bananas that is lower than 75 Euros, and they want open access to the market in terms of volumes. .
The EU itself has chosen to deal with the problem in the context of existing WTO rules which do not allow for special treatment for countries, except for the least developed states such as those in sub-Saharan Africa.
And, a rules-based WTO has little choice but to come down on the side of non-discrimination and equal trade access.
It is those rules that have to be changed if the EU is to institute arrangements which benefit Caribbean countries.
At the bottom line, the majority of CARICOM countries – in particular Belize, Barbados and the countries that comprise the Organisation of Eastern Caribbean States (OECS) are small and vulnerable economies. Guyana is in a class by itself as a Highly Indebted Poor Country. But, the WTO rules are deficient in relation to the special circumstances of small CARICOM states, and the Organisation should be persuaded to accept the special nature of their circumstances – as well as that of other ACP states – and place them in a special category.
This should be done not only for commodities but for services as well, or one day very soon the Caribbean will find its tourism and other services industries gravely affected by WTO rules.
If this does not happen, Caribbean states will continue to be judged by the rule of “one size shoe fits all”, and arbitration panels of the WTO will continue to come down against their interests.
In this connection, Caribbean states should be in the forefront of persuading the EU not to simply accept existing WTO rules, which is what they have been doing so far in respect of both sugar and bananas; instead the EU should be urged to lead the way in convincing the US, Japan and Mexico that a formula should be determined and advanced to create a new category of special and differential treatment for small and vulnerable ACP states.
The Latin Americans are pushing their interests; Caribbean countries should protect theirs.
EU TRADE
EU sugar plan sparks bitter row
Source: CNN
Tuesday, July 19, 2005 Posted: 1532 GMT (2332 HKT) EU sugar plan sparks bitter row
By Angela Saini for CNN
(CNN) -- Thousands of sugar farmers from Europe and Asia Pacific countries have been protesting over plans to reform Europe's sugar sector.
Demonstrations took place in Brussels Monday as Europe's agriculture council met for the first time to discuss sugar policy -- a process likely to conclude in November.
Reforms proposed by EU Agriculture Commissioner Mariann Fischer Boel in late June threaten to slash sugar prices by 39 percent and quotas by 30 percent.
Europe's biggest sugar producers are France, Germany and Poland, but the countries likely to lose out most under the reforms are low-yield sugar producers such as Italy, Greece and Ireland.
The Irish Farmer's Association says the livelihoods of 3,750 sugar beet growers could be wiped out. Sugar beet faces a 42 percent price cut under the proposed reforms.
African, Caribbean and Pacific countries, which have preferential access to European markets, also joined the protests.
A spokesperson from the Fijian sugar industry who is in Brussels told CNN: "We want a less drastic price cut spread over a longer period."
Britain, Germany, Denmark and Sweden are largely in favor of the reforms. Subsidies of $1.4 billion (£825 million) have kept European sugar prices three times higher than the rest of the world.
Cheap exports from Europe have also been blamed for stifling sugar industries in developing countries, including Brazil and India, the world's largest sugar producers.
Brazil, Thailand and Australia brought a challenge against the EU before the WTO last year, which ruled that subsidies to the sugar industry were illegal.
German Farm Minister Renate Kunast told The Associated Press on Monday that the commission's proposal was going "in the right direction."
Mariann Fischer Boel suggested in June that European farmers should receive between $7 billion and $8.75 billion in compensation over the five-year restructuring period, while ACP farmers will get $70 million in 2006, with payouts for a further seven years.
Oxfam policy analyst Penny Fowler said: "We are very glad that the EU is reforming the sugar sector but sugar industries in ACP countries rely on the high prices they receive in Europe. The EU is offering a miserly amount of compensation to ACP farmers compared to European farmers."
The sugar reforms will come into effect when the current policy expires on 1 July 2006.
UN / WTO
U.N. envoy warns WTO against touching food aid
Source: REUTERS
Tue Jul 19, 2005 7:38 AM ET
U.N. envoy warns WTO against touching food aid
GENEVA (Reuters) - Trade negotiators must not cut food aid as part of any World Trade Organization (WTO) deal on farm reform because a child dies every five seconds of hunger or related disease, a U.N. envoy said on Tuesday.
While welcoming moves to reduce rich nation farm subsidies, which hurt poor producers by distorting markets, U.N. Special Rapporteur on the Right to Food Jean Ziegler said that food aid provided by international agencies must be left alone.
Some WTO members are pressing for restrictions on food aid to be included in an accord being negotiated on liberalizing farm trade, alleging some rivals, particularly the United States, use it to dump excess output.
"The humanitarian aid carried forward by U.N. agencies, and especially the WFP (the U.N. World Food Programme) and its NGO (non-governmental organizations) partners must be excluded from the WTO's discussions," the Swiss sociologist and former Socialist Party member of parliament said in a statement.
Ziegler noted that according to the U.N, there were almost 300 million children suffering from hunger around the world. "Every five seconds a child dies from hunger or hunger-related diseases," he added.
But even countries proposing reform of food aid have made it clear at the WTO negotiations that this will not affect emergency assistance.
Advocates of change want more aid to be bought in the region to encourage local farmers and not disrupt markets rather than have large amounts of grain and other commodities shipped in by major international producers.
As part of the WTO negotiations, the European Union has offered to put an end to direct export subsidies for farm goods but on condition that the United States agrees to overhaul farm aid and its system of export credits.
ACP-EU TRADE
FARMERS PROTEST OVER SUGAR REFORMS
Source: TERRAVIVA-EUROPE
Tuesday, 19 July 2005
TRADE : FARMERS PROTEST OVER SUGAR REFORMS
by Stefania Bianchi
BRUSSELS (IPS) - More than 5,000 sugar farmers demonstrated in Brussels Monday as EU agriculture ministers gathered to debate the European Commission's proposed overhaul of the bloc's controversial sugar regime.
European sugar beet farmers and sugar cane farmers from the African, Caribbean and Pacific (ACP) group of countries gathered outside the European Union (EU) headquarters as agriculture ministers from the bloc's 25 member states discussed European Commission plans to end export subsidies and over-production of sugar.
”Save our sugar”, read one placard shown by the demonstrators as EU ministers met to discuss the proposals, although no immediate decision was expected.
The European Commission, the executive arm of the EU, is planning to cut the guaranteed price of sugar by 39 percent over two years from 2007 and offer 60 percent compensation for producers forced out of business by the price cut.
This would mean European sugar beet farmers, to whom the EU currently pays 42 euros (50 dollars) per tonne of sugar beet, will get 25 euros (30 dollars) per tonne by 2009.
Under current rules, the EU offers a guaranteed price for sugar that is paid for in effect by consumers, with Brussels buying from producers at about three times the average world market price..
The reforms became necessary after the World Trade Organisation declared the EU policies, which date back to 1968, illegal based on a complaint from Australia, Brazil and Thailand.
Eight EU member states -- Estonia, Finland, Greece, Italy, Ireland, Lithuania, Portugal and Spain -- are facing the prospect giving up sugar production. These countries are pushing for Commission plans are set to be watered down.
Only Denmark and Sweden are fully behind the reform moves to cut the EU's 1.7 billion euros (2 billion dollars) subsidies for sugar beet farmers.
According to the International Confederation of European Beet Growers (CIBE), the overhaul of the EU's 40-year-old sugar regime would put 90,000 jobs at risk, with repercussions for another 410,000 indirectly related positions in farming and industry across the bloc.
The proposed reforms will also hit the sugar sector in 18 ACP countries hard. These countries benefit from the EU's current preferred price system and are urging the EU to impose less drastic price cuts spread over eight years.
ACP countries have a long tradition of supplying sugar to the EU market under the terms of the ACP-EU sugar protocol -- a trade agreement that has been hailed the world over as a model for development cooperation and has brought significant benefits to ACP economies.
As part of its development policy, which has been criticised for unfairly discriminating against sugar producers from other developing countries, the EU currently pays above market rates for sugar from a number of ACP countries, many of them former colonies of European countries.
The preferential access of ACP countries to the EU market currently represents some 70 percent of the revenue of their sugar sectors.
The loss of those privileges when the EU starts paying prices closer to market rates is expected to have a huge economic impact on many ACP countries that are dependent on sugar exports to the EU. Most ACP sugar is produced in Mauritius, Swaziland, Fiji, Guyana and Jamaica.
ACP farmers joined their European counterparts Monday to express their shock and distress at the proposals which they say will cripple sugar production in ACP countries.
Officials from the affected countries say the proposed reforms are disastrous and would put vulnerable economies and hundreds of thousands of jobs at risk. ACP ministers said the reforms would mean losses to their countries of an estimated 400 million euros (482.6 million dollars) a year, when the daily earnings per capita in some ACP countries are less than two euros (2.4 dollars) a day.
While the European Commission is offering 40 million euros (48.2 million dollars) to help ACP producers, the reform plans will mean far more in losses.
ACP representatives say that while ”generous compensation packages” are being proposed for EU sugar beet farmers and processors, the ACP has so far only been promised a ”paltry” amount to cushion the effects of the reform.
”Reform is supposed to improve the lives of people, but what the Commission has proposed would quite simply destroy us. Thousands and thousands of jobs would be lost with little or no alternative employment and the ensuing social consequences hardly bear contemplating,” Christian Foo Kune of the Mauritius Cane Growers Association and president of the Mauritius chamber of agriculture said Monday.
”We just want to be treated fairly,” added Foo Kune, whose own country stands to lose over 100 million euros (120.5 million dollars) a year under the terms of the proposals. ”Unless adequate funds are made available immediately to help us adapt and survive, our future is terrifyingly bleak. Poverty, social instability, and the destruction of our way of life is all that awaits us.”
The international relief agency Oxfam is also calling for a slowdown of the reform process, and urged member states to reject the package.
”The difference between the compensation packages for EU producers and for African ones exposes the double standards and selfishness at the heart of the Commission's proposals,” Luis Morago, head of Oxfam's Brussels office said Monday.
”Some of the poorest countries in the world can grow sugar much more efficiently than Europeans but they are being left high and dry by these proposals. This calls into question the EU's stated commitment to tackling global poverty,” he added.
The Commission's proposals have to be approved by the EU agriculture ministers before they can be adopted.
(END)
AFRIQUE -DEVELOPPEMENT
Exposer les avantages et les inconvénients du sommet du G8
Source: TERRAVIVA-EUROPE
mardi, 18 juillet 2005
Exposer les avantages et les inconvénients du sommet du G8
Moyiga Nduru
JOHANNESBURG, 18 juil (IPS) - Caroline Sande-Mukulira s'est jointe, il y a deux ans, à des activistes de la société civile dans la station touristique française d'Evian pour plaider la cause de l'Afrique.
Ses expériences au sommet du G8, où des dirigeants des pays les plus industrialisés traînaient les pas sur des questions mondiales - y compris les problèmes auxquels est confrontée l'Afrique -- l'ont laissée déçue. ''Je m'étais dit que je ne prendrais plus part, à nouveau, à un sommet du G8'', se rappelle-t-elle. Néanmoins, la responsable du programme Afrique australe de 'ActionAid International' s'était retrouvée à une autre rencontre du G8 : la toute dernière du groupe, qui s'est déroulée il y a quelques jours (6-8 juillet) à Gleneagles, en Ecosse. ActionAid est une organisation non gouvernementale basée à Johannesburg.
''Gleneagles a été différent. L'Afrique a été un centre d'intérêt du sommet'', affirme-t-elle. Cependant, tout ne s'est pas s'est passé de la manière dont elle l'aurait voulu.
''Ce que l'Afrique demandait au G8, c'était un grand bond en avant. Tout ce qu'elle a eu, c'est de tous petits pas. L'accord qui a été annoncé est très loin de nos demandes'', a déclaré Sande-Mukulira à une conférence de presse dans la capitale économique d'Afrique du Sud, Johannesburg, jeudi (14 juillet). Le briefing a passé en revue les décisions de la rencontre de Gleneagles.
''Les leaders du G8 ont promis 50 milliards de dollars supplémentaires d'aide d'ici à 2010, 25 milliards de dollars pour l'Afrique'', a indiqué Sande-Mukulira. ''Même si tout accroissement de l'aide est le bienvenu...cela vient trop tard pour les 50 millions d'enfants qui mourront entre maintenant et 2010. Moins de la moitié de ce financement -- entre 15 et 20 milliards de dollars -- est réellement de l'argent neuf''.
Elle a dit qu'ActionAid était également déçue par le niveau de l'allègement de la dette, annoncé par les dirigeants du G8.
En juin, les ministres des Finances des Etats membres du G8 ont annoncé une annulation de la dette pour 18 pays, dont 14 en Afrique. ''L'annulation de la dette s'est attaquée à seulement 10 pour cent du problème et est très en dessous de l'annulation totale de la dette dont ont désespérément besoin plus de 60 pays'', a souligné Sande-Mukulira.
Toutefois, la plus grande déception du sommet concernait le commerce.
''Un accroissement de l'aide seule ne va pas mettre fin à la pauvreté. Nous avons besoin de libre-échange pour promouvoir la croissance'', a indiqué aux journalistes Sue Mbaya, directeur du Réseau régional de lutte contre la pauvreté en Afrique australe, le 14 juillet. ''La plupart des pays africains ont de mauvais résultats dans la réduction de la pauvreté''.
Mbaya a critiqué par la suite le G8 pour n'avoir pas expliqué bien clairement les mesures pour assurer la sécurité alimentaire -- attirant l'attention sur de graves pénuries alimentaires en Afrique australe.
Dans un communiqué publié pour coïncider avec le sommet du G8 à Gleneagles, le Programme alimentaire mondial (PAM) mettait également en garde contre une crise dans la région. ''En Afrique australe, la triple menace du VIH/SIDA, des conditions de sécheresse et d'une faible capacité gouvernementale menace la vie d'au moins huit millions de personnes. L'opération du PAM pour les nourrir est financée à moins de 20 pour cent'', a noté l'agence de l'ONU.
Le PAM indique qu'il sera obligé de réduire ses activités en Zambie ce mois, à moins que les donateurs n'apportent les 12 millions de dollars supplémentaires requis pour nourrir plus de 400.000 personnes. Les femmes, les enfants, les personnes âgées et les personnes affectées par le VIH/SIDA feraient partie des gens qui souffriraient le plus de la réduction, selon l'agence. Le PAM a besoin de 25 millions de dollars pour nourrir 820.000 Zambiens au cours de 2005.
ActionAid a également exprimé des inquiétudes sur l'effet que les récentes délibérations du G8 auront sur les efforts pour contenir la pandémie du SIDA en Afrique.
''Le G8 a répondu au mouvement global pour le traitement du SIDA en soutenant l'accès pour tous d'ici à 2010. Mais un gap financier de 18 milliards de dollars, pour assurer le traitement du VIH/SIDA, au cours des trois prochaines années, demeure toujours'', a souligné Sande-Mukulira.
L'Afrique australe est la région la plus durement touchée par le VIH/SIDA. Bien qu'elle compte juste deux pour cent de la population mondiale, elle abrite jusqu'à 70 pour cent des personnes vivant avec le VIH/SIDA -- ceci selon le 'Rapport 2004 sur la pandémie du SIDA dans le monde entier', publié par le Programme conjoint des Nations Unies sur le VIH/SIDA.
Malgré ces revers, des groupes de la société civile ont demandé aux militants de ne pas abandonner. ''Nous devons retourner à la case départ'', a déclaré Mbaya. ''C'est à l'Afrique de se lever''.
Durant la conférence de presse, Sande-Mukulira a rejeté les affirmations selon lesquelles les dirigeants africains faisaient peu pour combattre la corruption -- qu'on dit souvent être à la base de la réticence de l'Occident à accroître l'annulation de la dette, ou à apporter plus d'aide au continent.
''C'est une vieille excuse ressassée pour l'Afrique. Les choses sont en train de changer en Afrique. Les sociétés civiles mettent la pression sur les gouvernements pour qu'ils combattent la corruption'', a-t-elle affirmé..
Elle a également mis en cause la large couverture médiatique accordée à une campagne lancée par le gouvernement zimbabwéen suite à la destruction des maisons et entreprises informelles dans les zones urbaines. L'administration d'Harare dit que la campagne a pour but de supprimer le commerce illégal des produits essentiels, et de démolir des constructions non autorisées. Toutefois, l'opposition voit l'initiative comme une vendetta contre ses partisans, qui sont pour la plupart dans les villes du Zimbabwe. La campagne dénommée 'Opération restaurer l'ordre', aurait affecté plus de 300.000 personnes.
''Les violations des droits de l'Homme dans d'autres pays africains pourraient probablement être plus sérieuses que ce qui se passe au Zimbabwe à l'heure actuelle'', a déclaré Sande-Mukulira. ''Il y a d'autres crises en cours en Afrique, mais la communauté internationale n'est obsédée que par le Zimbabwe''. (FIN/2005)
EU TRADE
EU sugar reform plans will hurt poorest
Source: OXFAM GB
July 18 2005 EU sugar reform plans will hurt poorest
Press Release - Oxfam GB
Proposed European Union sugar reforms will hurt the poorest and most vulnerable farmers in Europe and the developing world and will not end dumping, international agency Oxfam said as agriculture ministers met today in Brussels to discuss the plans for the first time.
Luis Morago, Head of Oxfam's Office in Brussels said: "Reform is urgently needed but these proposals are unacceptable. They will not end EU overproduction and export dumping and do nothing to harness the potential of sugar production to reduce poverty. The steep, sharp price cut will hurt poor countries that depend on selling their sugar to Europe and small producers in Europe. Member States should reject this package and call for reforms that help poor farmers at home and abroad."
The current proposals include a price cut of 39% for white sugar and 42% for beet, to be phased in over two years from 2006. A compensation fund of € 6,000m euros will be available for EU producers and there will be a "buy-out scheme" to help them leave the sector. African, Caribbean and Pacific (ACP) countries, who are currently allowed to sell their sugar to Europe at high prices, will get €40m in 2006 to help them adapt to the changes.
Morago: "The difference between the compensation packages for EU producers and for African ones exposes the double standards and selfishness at the heart of the Commission's proposals. Some of the poorest countries in the world can grow sugar much more efficiently than Europeans but they are being left high and dry by these proposals. This calls into question the EU's stated commitment to tackling global poverty."
A large group of less efficient European producers, including Spain, Ireland, and Italy, are expected to raise strong objections at today's meeting. This will add to the concerns already voiced by many developing countries about the impact of the proposed reforms on their sugar industries, as well as the inadequacy of the package of adjustment assistance they have been offered.
Morago: "Agriculture Ministers must listen to the developing world about the impact of these changes on the livelihoods of tens of thousands of poor sugar workers and their families."
Oxfam is calling for more gradual price cuts over a longer period of time; quota cuts for European production; an end to EU export dumping; improved access to the EU for developing country sugar; and a package of adjustment assistance for poor countries commensurate with their needs.
ACP-EU
SOUTHERN AFRICA: ACP sugar producers concerns legitimate
Source: IRIN
19 Jul 2005 18:26:11 GMT SOUTHERN AFRICA: ACP sugar producers concerns legitimate
JOHANNESBURG, 19 July (IRIN) - The African, Caribbean and Pacific (ACP) sugar producers have legitimate concerns over the compensatory aid being offered by the European Union (EU) after its proposal to cut sugar prices, suggests a new research paper.
Previous experience of EU compensation when the prices of bananas, cocoa and rum were cut "have been unpleasant, so they have reason for concern", said Calvin Manduna, a researcher with the nonprofit Trade Law Centre for Southern Africa, who wrote the paper.
As part of ongoing reform the EU has proposed reducing the price of sugar in its domestic market to international levels, as it did for bananas some years ago.
Sugar is sold in EU countries at three times the international price, and the proposed reduction will bring down the cost to Europe of ACP sugar.
According to a proposal by the European Commission, ACP countries will continue to enjoy duty-free access to the EU, but the sugar purchase price will be reduced by one-third between 2005 and 2008. Regional sugar producers that stand to lose include Swaziland, Malawi, Mozambique and Mauritius.
Sugar trade between ACP countries and the EU has been regulated by two agreements - the ACP/EU Sugar Protocol and the Agreement on Special Preferential Sugar - but the EU has been under pressure to revise its agri-policy regarding sugar quotas.
The Sugar Protocol is an agreement between governments, in which EU member states undertake to buy specified quantities of sugar at guaranteed prices from ACP states.
However, Australia, Thailand and Brazil, which are excluded from the Sugar Protocol, recently successfully challenged the agreement at the World Trade Organisation.
The EU has offered to make up for the ACP countries' loss of revenue as a result of the changes.
Manduna explained that in the past, compensatory mechanisms to ease price cuts - such as financial support to ACP banana producers via a programme called Special Framework for Assistance, which provided funds primarily to improve productivity and competitiveness, but also included diversification activities - had not worked well because they had not been properly planned.
"The funds being offered to make up the loss arrived too late," he noted. In the case of diversification, particularly in the case of Caribbean producers, the emphasis had swung to building the tourism industry, which was seasonal.
The EU has proposed a similar scheme to help Sugar Protocol ACP countries adjust to reforms in the EU sugar regime.
"It is impossible to overstate the devastating impact the price cuts and timescale proposed by the EU will have on the ACP countries ... as far as the ACP is concerned, the proposed reform is too fast, too deep and too soon," Manduna commented.
ACP countries have called for shallower and more gradual price cuts over eight years to allow them to adjust, he said.
Besides, the proposed compensatory measures were considered meagre at not quite US $48 million for 18 countries, Manuna added. Some NGOs have called for compensation to the tune of more than $500 million, with adequate technical and financial adjustment assistance.
"The ACP countries also feel that the offer made to them is unfair compared to the kind made to the EU farmers, who will be compensated for 60 percent of their losses, and there will also be a 'buy-out' scheme for those European factories that will go out of business," he pointed out.
ACP countries anticipate a loss of at least $500 million as a result of lower prices.
According to the Swaziland Sugar Association, the industry is expected to lose more than US $23 million in 2005/06 and more than $39 million in 2007/08 as a result of the price cut.
However, Manduna told IRIN that regional sugar producers - Swaziland, Mozambique, Malawi and Zimbabwe - were "low-cost producers", who could survive "with some restructuring ... to become more competitive".
