APPENDIX 2
Memorandum submitted by ACP London Sugar
Group
We ask that our following concerns are taken
into account by the joint meeting of the European Scrutiny Committee
and the Agriculture Committee of the House of Commons to assess
the EU Everything But Arms proposal for LDC's (EC 12335/00) and
the new EU Sugar Regime proposals (EC 12087/00).
— In Cotonou in June 2000 the EU and
ACP signed a post Lome IV new partnership agreement. It sets out
in detail a lengthy timetable in which trade barriers would be
progressively removed for the ACP and the new arrangements would
become WTO compatible. A "preparatory" period of eight
years, 2000 to 2007, was agreed followed by a "transition"
period of a minimum 10 years to be negotiated for the economic
partnership agreement. The special legal status of the Sugar Protocol
was endorsed. Evolving duty free access from LDC's was provided
for, with the phrase "essentially all the products"
(Article 37[9]) clearly understood to mean the exclusion of "sensitive"
products covered by Commodity Protocols and the CAP, such as sugar,
rice and bananas.
— The current regime expires in June
2001 and DG Agriculture has proposed a new two year Sugar Regime,
whereas the majority of Member States, and the ACP sugar suppliers,
are seeking a five to six year period. This proposal is following
the normal committee procedures, scrutiny by the European Parliament
and two impact studies have been commissioned and will be completed
within two years.
— DG Trade has proposed, commencing
1st January 2001 to eliminate duty and tariffs for "Everything
But Arms" from the LDC's. This proposal is being fast tracked
and structured so that it does not have to be referred to the
European Parliament. It dramatically contradicts the terms of
the Cotonou Agreement by including the sensitive products, such
as sugar, rice and bananas by the replacement of "essentially
all" by "Everything But Arms" and by sharply advancing
the Cotonou timescale.
— If the EBA proposal is not amended
Commission sources estimate some 2 million tonnes of LDC sugar
would enter the EU within three years. This enormous increase
in imports will quickly destabilise the EU sugar market and undermine
the Sugar Regime, firstly by eliminating the Special Preferential
Sugar Agreement (250/300,000 tonnes ACP sugar) and secondly by
putting severe pressure on the Sugar Protocol (1.3 million tonnes
ACP sugar).
— It would be devastating for ACP sugar
suppliers and their fragile developing country economies, particularly
for the Caribbean producers who supply sugar, rice and bananas.
These producers are ploughing back their EU sugar income to modernise
and reduce costs in their sugar industries, and their ability
to achieve their strategic objectives depends upon finance made
available against guaranteed long term sugar income from their
exports to the EU.
— The ACP sugar industries understand
the global WTO pressures for liberalisation but to survive require
change to be gradual and progressive and to be managed over a
lengthy timeframe, as is envisaged under the Cotonou Agreement.
Clearly they are fully sympathetic with the EU's wish to further
assist the world's 48 poorest countries, 39 of which are signatories
to the Cotonou Agreement, but believe this can be achieved by
adopting coherent and not contradictory EU initiatives which,
in addition, would not be detrimental to their interest.
— We consider that the UK Government,
the other EU Member States and the Commission must be pressed
to achieve coherence between DG Agriculture in respect of their
Sugar Regime proposals and DG Trade in respect of their LDC proposals,
that the European Parliament must be consulted on both interrelated
issues, that an overall integrated impact study must be carried
out covering both issues, which is independent and published,
and that the EBA proposal is amended so that it at least excludes
the sensitive products of sugar, rice and bananas until the overall
impact exercise is completed. It is crucial for the ACP that the
"essentially all" criteria and timeframe of the Cotonou
Agreement are reinstated to ensure managed change and the avoidance
of devastating circumstances for ACP sugar suppliers to the EU.
— With some of my colleagues I would
be happy to follow up this note by attending the meeting on 20
December 2000.
13 December 2000
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