Published On: Thu, Apr 13th, 2017

Tariffs suggested to protect region’s sugar industry

Sugar production quotas in the European Union will be scrapped at the end of September and industry experts warn that the region will suffer the backlash of a drop in prices.

1390591060-sugarcane-1KINGSTON – Stakeholders in the region’s sugar industry have laid a strong case for governments to impose tariffs to protect the fragile sector as major challenges loom.

In another six months, production quotas in the European Union (EU) will be scrapped and industry experts warn that the region will suffer the backlash of a drop in prices.

At the recent sixth meeting of Caribbean Stakeholders on Sugar in Jamaica, concerned players argued that the expected fallout could be cushioned by the provision of some level of protection, even as they urged Governments to take back control of the sector.

“Governments around the world give tariff protection to their own sugar industries, yet in the Caribbean we are currently losing out to imported sugar from outside the region. It is time to modernize our approach to sugar,” the group said in a statement.

They also reasoned that the net cost effect of the tariff would hardly affect consumers but it would be a significant boost to the sector.

“It will give our industry the ability to attract investment, mechanize the industry and provide quality jobs and a sustainable future for the sector,” the group said.

Programme Manager at the CARICOM Secretariat, Nisa Surujablly, warned that the regional sugar sector must be diversified and become competitive to survive when the production quotas in the EU are removed.

“Survivability of these industries, after the removal of production quotas in the EU on September 30 2017, will in no small measure be a function of improved competitiveness, securing more remunerative markets, value addition, an enabling policy regime within the Caricom Single Market and Economy, and, not lastly, practical and pragmatic diversification options.

“I say this as a technical official while being acutely aware of the emotional associations we have with our region’s oldest economic sector. This industry is responsible for us being here and has coloured our history from colonization, to slavery to indentureship and to independence. It is not an easy time! Now is crunch time”, she said.

At the same time, managing director of The Caribbean Council , Chris Bennett, suggested that there was still a future for sugar sector.

He however made it clear that the framework for trade needs to be modernized to reflect that the Caribbean no longer can or should depend on the EU market as a guaranteed buyer.

“The trade and tariff policies required are straightforward and applied all around the rest of the world. There is an urgent need for the CARICOM Single Market and Economy to put in place the equivalent protections as soon as possible,” he said.

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