Brussels 17/04/2015 (Agence Europe) - Sugar supplying countries from the ACP (Africa, Caribbean, Pacific) Group are seriously concerned by the sharp fall in sugar prices which has come about much earlier than forecast, and they therefore rang the alarm bell in Brussels last week. They see the fall in prices as the direct consequence of the imminent abolition (in 2017) of sugar quotas - an abolition they vehemently opposed. Futhermore, they draw European attention to the fact that this situation, which is particularly harmful to small vulnerable economies, runs counter both to the arrangements of the Cotonou Agreement linking them to the European Union, and to the economic partnership agreements (EPAs) which most of them have signed. The ACP Sugar Group notes with concern that several closely linked factors could significantly compromise the outlook of future ACP sugar suppliers to the EU.
The ACP countries had asked for the current system to be extended until 2020 so as to enable completion of their action plans. These plans were set out by the EU in order to carry out the modernisation and diversification of the fragile ACP sugar industries and to strengthen the industries' effectiveness.
When signing the EPAs, most of the ACP sugar supplying states had expected long-term perspectives for access to the EU sugar market, and stable and remunerative sugar prices to be maintained on a regulated EU market. “The EU decision to abolish sugar quotas prematurely therefore seems to contradict and undermine the EPA objectives and the concept of policy coherence for development to which the EU is strongly committed, and which is a fundamental aspect of the Cotonou Partnership Agreement”, the ACP states.
The ACP Sugar Group reiterates that the value of the preferences provided for in the EPAs depends on guaranteed market access combined with price stability on the EU market. This has long been crucial for preserving ACP sugar export earnings. “These, in turn, underpin the ability of many of the small and vulnerable economies to import other products, which help to provide food security. More importantly, thousands of small sugar growers in ACP countries continue to depend on these earnings for their livelihood. The importance of this key commodity to EPA signatories and the least developed countries has been set aside in the latest EU sugar reform of 2013”, the ACP Sugar Group notes. It is also concerned by the fact that European prices will be aligned more closely with world prices and, according to the EU's own forecast, will be at levels rendering the preferences granted under the EPAs almost valueless. “Planning and investment decisions for sugar cane require a view of market conditions well beyond 2017”, the ACP says.
The ACP Sugar Group also says that it “has appreciated the innovative accompanying support programme, initiated and funded by the EU, granted to the former ACP sugar protocol states. However, significant constraints relating to implementation in terms of management and slow disbursement of the funds continue to pose serious challenges. The support programme is far from providing the so-called 'soft-landing' as has been widely claimed.” (Aminata Niang)