EU Agrees to 36 Per Cent Cut in Price of Sugar

The European Union (EU) agriculture ministers have reached a deal to reform its sugar policy, agreeing to a 36 per cent cut in sugar subsidies over a four-year period.
The decision was reached after a marathon meeting in Brussels today (Nov. 24).
As part of the deal, beet growing farmers, who wish to abandon their fields, would be paid 64.2 per cent of revenue lost due to the price cuts.
But the move is likely to hurt sugar-producing African Caribbean and Pacific (ACP) states including Jamaica, which have benefited from the EU’s sugar subsidy policy.
However, EU Agriculture Commissioner, Mariann Fischer Boel has said that the new sugar agreement “complies completely” with World Trade Organization (WTO) rules.
The EU has been criticized for its subsidy-laden policy, which has allowed tonnes of EU sugar to flow into world markets, lowering prices. The WTO, after a case brought by big producers such as Brazil, Australia and Thailand, ruled that the European sugar aid system was illegal and gave Brussels until May 2006 to bring its policy in line.
The EU has previously proposed a 37 per cent cut over three years, but Jamaica and the other ACP countries expressed opposition to the plan. They instead suggested a 19 per cent reduction to be phased in over an eight-year period. They have said, that their sugar cane growers would be less able to cope with the changes than European farmers.