London : The European sugar industry is deeply concerned by a proposal to allow duty-free access for sugar from the world's poorest countries, despite a proposed delay, a senior UK sugar industry official said.British and European sugar producers, growers and suppliers have protested that EU trade commissioner Pascal Lamy's "Everything But Arms" (EBA) plan announced last year, would trigger a flood of cheap imports and destroy the EU sugar industry.The proposal extends duty-free access to all products, except weapons, from the 48 least developed countries (LDCs).
Following intense industry lobbying, the European Commission proposed on Wednesday, that free sugar access be phased in between 2006-2008, five years later than originally envisaged.
"It's of marginal help but we can't concede the principle of allowing in sugar, without assessing the damaging implications for the EU and UK sugar industries," Mr Chris Carter, director of agriculture at British Sugar Plc, said in a telephone interview.
British Sugar, a unit of Associated British Foods Plc, is the sole processor of British beet sugar producing about 1.3 million tonne of refined sugar annually.
"We aren't against the principle of aiding poor countries through the EBA, but sugar was suddenly added to the list of products without warning or consultation," Mr Carter said.
The jobs of some 500,000 people in the EU sugar industry, including 23,000 in Britain, would be at risk, he said.
The EU already imports 1.5 million tonne of raw cane sugar, mostly into Britain, at preferential prices from nearly 20 African, Caribbean and Pacific (ACP) developing countries under the Cotonou agreement.
Mr Carter said that the EBA proposal was incoherent, as it would harm the ACP group at the expense of another group of developing countries.
It also pre-judged plans to carry out detailed studies on the future of the EU sugar regime, he added.
Mr Carter said that commissioner Lamy's talk of safeguards was valueless, unless these were clearcut, pro-active and limited the amount of sugar that could be exported to the EU.
He said that the beneficiary countries produce about 2.5 million tonne of sugar annually, and could significantly expand domestic output so as to maximise the EU trade concession.
Mr Carter did not specify which countries posed the greatest threat, but analysts said that Sudan and Ethiopia, which do not belong to the EU/ACP sugar protocol, would be major gainers. In Asia, Bangladesh would be a winner.
In addition, Mr Carter said that international traders would be likely to import sugar, into the 48 countries for re-export to the EU in a so-called "carousel" trade.
If unrestricted, the carousel trade could result in three to five million tonne of sugar pouring into the EU market - equivalent to up to 40 per cent of annual demand, he said.
"It's a huge loophole and the poor countries may not benefit from it," Mr Carter said. "It would be a chaotic free-for-all."
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
