Postpone the abolition of sugar quotas, COMESA tells the EU

The decision by the European Union (EU) to eliminate sugar export quotas to the bloc by 2017 was castigated by heads of state at the just-ended COMESA Summit.

Sugar cane harvesting.
Sugar cane harvesting.

The African representatives proposed that abolishing the quota should be postponed till 2020. Zimbabwe is amongst the sugar exporting countries to the EU.

The EU resolved to end the 45-year old system of sugar production quotas, blaming it for creating artificial shortages of sugar in Europe. An impact study conducted by the EU has also forecasted that the EU’s domestic sugar prices would decrease by 45 per cent, compared to 2012 market prices, if the quotas ended.

However, COMESA (The Common Market for Eastern and Southern Africa) says the move will seriously injure COMESA sugar exporting states. As well as a delay on implementing the abolition, the body called for the EU to “put at the disposal of COMESA sugar exporting member states additional resources to pursue the modernisation of the sugar sector towards becoming globally competitive”.

Under the sugar protocol, Zimbabwe’s preferential tariff quota stands at 30,225 tonnes a year, which is also supplemented by a variable special preferential sugar quota. Although the impact of the quota elimination is yet unclear on the viability of Zimbabwean sugar companies, analysts believe that growing sugar demand in the country might offset the planned phasing out of the export quotas. The country’s per capita sugar consumption is estimated to be 24.6kg.

The African-Caribbean and Pacific (ACP) bloc also criticised the move by the EU last year, saying the quota abolition would lead to market instability and price volatility. ACP currently contributes 60 per cent of the EU’s sugar imports. ACP is on record saying that it “firmly believes that this time lag will be too short to implement measures to improve the competitiveness of their respective industries and allow to operate successfully in such a liberalised market.”

Post published in: Agriculture

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