Contradictory interests. The definition of the new European regime for sugar should be analysed as attentively and dispassionately as possible; because there are a great many interests at stake, many of which are, most unfortunately, contradictory. There are the interests of European agriculture and those of the European sugar producers. There are the interests of the European consumers. There are the interests of world trade and of the producers from outside Europe, and there are WTO decisions the EU has to fall in line with. There are the specific interests of the ACP producer countries associated with the EU, and these interests are diametrically opposed to those of other large global producing countries. And on top of all this is a slight whiff of oil. Each of the parties has taken position to defend its own interests, and it's like the Tower of Babel.
The masquerade of certain NGOs. All interested parties have reasons which need to be taken on board. I will leave to one side the thundering yet inept stances taken by Oxfam. This non-government organisation (NGO) still enjoys a certain prestige, thanks to its past merit and the financial resources at its disposal, but for some time now, its main concern has been to defend the interests not of poor countries (even though it still points a few spectacular, populist actions in their direction), but of big business. This sugar business is proof positive of this. For years, Oxfam fought with the usual slogans (fortress Europe and other soundbites in the same vein) for the European sugar market to be opened up to world-wide competition, and thus for the reduction of internal European prices. WTO rulings and the current proposals of the Commission indicate that the EU's policy is indeed too protectionist and that it is difficult to justify its “subsidised exports”. But at the same time, Europe applies the same price as the internal European price to the exporting ACP countries (and even to India, for a certain amount). By bringing its internal price down, the EU will obviously have to reduce the prices it guarantees to the ACPs by the same amount. So now Oxfam, which did all in its power to oblige Europe to open up its borders and reduce its prices (and rightly so, to an extent), has now taken issue and is standing up to defend the poor countries which are now going to suffer the consequences of the policy it has always backed, published inflammatory press releases (the draft Constitution “will have devastating consequences on the poor countries of the world”) and got together with other NGOs to hold press conferences demanding that the EU guarantee “fair prices” to countries such as Mauritius, Mozambique, Malawi, Zambia, Guyana and Barbados (which it did do, for as long as it was allowed), as if it could start paying these countries “preferential” prices, higher than its internal prices, tomorrow.
Genuine interests of ACPs and other poor countries. Certain NGOs act in good faith, but they should make the effort to understand that in the agricultural sector in general, the total opening up of Europe's borders to world competition benefits the rich countries (United States, Australia, New Zealand or Canada, depending on the product) and the emerging colossuses (Brazil and, soon, China) to the detriment of the poor countries. And the ACP States have their responsibilities too, at least the ones which have come into line, at the WTO, with the demands of the countries calling for free trade in agriculture and which reject the notion of the “multifunctionality” of agriculture. At the same time, this notion is taken up by several ACPs in the defence of their legitimate interests! These ambiguities are dangerous; this notion, which was born in Europe, has to be accepted as a principle which is valid for all, not just to some, intermittently. I regret to say that when it comes to sugar, even the WWF has slid into populism. It recognises (statement by Elizabeth Guttenstein) that in developing their sugar cane production, certain poor countries cause soil erosion and pollution. And whose fault is it? The EU's, of course, because it did not help them to produce sugar “in respect of the environment”. Taking position on Oxfam's side, the WWF has called on the EU to pay the ACP countries and other poor countries “a minimum of 500 million EUR a year”, even in countries where the sugar crop was less than a roaring success, for concerns related to the environment which, in the view of this organisation, should be the number one priority). Louis Michel, whose actions in favour of the poor countries are serious and concrete rather than populist and hypocritical (by which I mean that he concerns himself with their issues, not those of big international business), said that the EU would pay for serious projects in the ACP countries, to bring sugar production up to date or to replace it with the production of other crops where sugar cannot be made to pay. This is precisely the policy suggested by the Commission for the EU itself. The ACP countries presenting viable projects will be helped; 40 million EUR is earmarked for 2006 in favour of projects already submitted to Brussels (Mr Michel referred specifically to Mauritius). Other funding will follow if similar projects arrive, including for the production of bio-ethanol. But the EU will not go on supporting projects as if there were no tomorrow, aiming just to pump up subsidies. Louis Michel pointed out that as of 2009, sugar from the poorest countries in the world will freely enter the Union, with neither customs duty nor quotas, and he mentioned the figure of 3.5 million tonnes as a possible annual volume of imports under this system. But at the same time, he stressed the requirement for the Parliament and Council to add strict, effective measures against fraud, such as bringing sugar into the EU labelled as originating from the poor countries but actually coming from elsewhere; the only ones to complain against this kind of precaution are those who put the interests of big business over the development of the poor countries.
Europe's genuine interests. Having exhausted, for the time being, my analysis of the external plank of the dossier, what about the internal one? I know it's not fashionable, but I'm concerned about European agriculture too, so much so that I think that for basic products, European should be self-sufficient. When and why did the industrial production of sugar develop in Europe using sugar beet (beta vulgaris, variety rapa, form saccharifera)? I got those terms from an encyclopaedia. The presence of sugar in this beet was discovered in 1605 by Olivier de Serres. In 1747, the Prussian chemist Marggraf managed to isolate this sugar, and the first sugar plant was set up in Sicily in 1797. But the wide-scale growth and industrial production of sugar didn't really take off until 1806, in France, to offset some of the consequences of the “continental system” decreed by Napoleon to answer the British “naval block”. In practice, these two actions combined prevented any cane sugar from arriving on the European continent, amongst other products. Sugar beet guaranteed Europe the autonomy of its sugar supply. Nobody would think of waging Napoleonic wars these days by other means, but even so, it's a strange coincidence; it was a technological breakthrough that allowed the continent to avoid the risk of poverty. A bit of food for thought in the debate on Europe's food autonomy thanks to the CAP.
The European Commission, incidentally, put forward its proposed reform as the means of safeguarding and guaranteeing permanent European sugar production, which implies that sugar beet should be grown in places where it is reasonably economically viable. This does not mean producing it at world prices, which are artificial, or at Brazilian costs, but radically reducing current guaranteed prices. The Commission put the reduction required at 39% for sugar (in four years) and 42.6% for sugar beet (in two years). The results would be a considerable reduction in European production, the disappearance of sugar beet crops from certain regions of the Union, the end of subsidised exports, the increase in imports. The EU would partially compensate the losses of the sugar beet grower obliged to make do with less money or to move into different areas, as would the closure of sugar factories which could no longer pay their way.
Public hearing. As predicted, the European farmers and the authorities of the ACP countries have protested, roundly criticising the Commission's plan, particularly the level and speed of the drop in guaranteed prices. Several EU governments have announced that there will be battle royal within the Council (but the French minister- whilst calling for changes- said that the general plan is acceptable). Within the European Parliament, everyone reacted depending on the interests of their own countries, the concept of safeguarding European agriculture as a whole being unheard of. According to an MEP from the UK, it is “indefensible” to subsidise sugar production at the expense of the developing countries; a Spanish member criticised the Commission for wanting to concentrate sugar production on prosperous areas leading to its abandonment in less-favoured ones; an Italian MEP voiced concerns for employment in certain parts of Italy; in the view of a German Green, the project helps sugar multinationals and sounds the death knell for the sugar beet sector in Europe; a Belgian Socialist said that consumers would lose out too, because the price for a kilo of sugar in the shops would not fall. But the Committee on Agriculture of the EP was more circumspect, avoiding taking position before the public hearing to be held this Wednesday 13 July.
Whiff of oil. On this occasion, it might be as well to look at the reactions of the professional organisations, which logically expressed their concern and which also look at other elements such as stocks, fluctuation in production (a deficit was spoken of for the marketing year underway) and the prospects for the production of bio-ethanol from sugar cane, where Brazil has virtually unlimited possibilities and is going into this in depth: production of 16 billion litres a year and annual investments of nearly one billion dollars a year by 2010! It would be fantastic for Europe to diversify its supply and break free of excessive dependency on oil and the oil companies, the oil kings of the Middle East or the American magnates, determining the price of crude with their speculations.
(F.R.)