Date: FRIDAY 14th September 2007

Press Conference

Time:  1:30 – 2:30 pm

Venue: IPC Centre Brussels, Passage Room,  Rue de la Loi 155, Bloc C, 1040 Brussels

The ACP Ministers representing the signatory States to the ACP-EU Sugar Protocol have convened a special ACP Ministerial Consultations on Sugar in Brussels to deliberate on the EC’s market access offer to ACP States under EPAs and its decision to denounce the Sugar Protocol.

Head Table at International Press Conference 

Chairman:  Minister of Foreign Trade and International Cooperation, Guyana, the Hon. Lionel Jeffries 

ACP Ministerial Spokesperson for Sugar and Minister of Agro Industry & Fisheries, Mauritius:  The Hon. Arvin Boolell 

Minister for Finance, National. Planning, Public Enterprise and Sugar Industry, Fiji, The Hon. Mahendra Chaudhry 

Filling in for the Minister of Trade of Swaziland, Principal Secretary Mr. Clifford Mamba 

Ambassador of Guyana, Brussels, H.E. Mr. Patrick I. Gomes 

Out-going Chairman of the ACP Consultative Group on Sugar, H.E. Mr. George Bullen 

In the 4 April, 2007 offer on duty-free quota-free to ACP States under the future EPAs the EC is not honouring its legal and political obligation.  The EC claims that EPAs are to be development tools.  The Sugar Protocol is par excellence, a model North-South trade agreement with a strong development dimension.  No WTO member has challenged the Sugar Protocol which has stood the test of time and is an example of integration, of production and processing (value addition) between the ACP suppliers and EC processors.  It is a win-win collaboration of mutual interest to safeguard the benefits of the Sugar Protocol. The S.P is a long standing inter-governmental agreement.  

The EC’s intention to denounce the Sugar Protocol is totally out of proportion and is not borne out of any juridical security.   Coming soon after its April, 2007 market access offer, this decision is borne out as a hidden agenda to use the EPA to kill such a model arrangement. 

For some time now the EC seems to be adopting, in a systemic manner, measures aimed at slowly killing the Sugar Protocol.  In this respect, the proposals by the Commission are such that, the ACP Sugar Protocol countries are being made to pay the price.  Furthermore, it should be recalled that with the introduction of the EBA initiative, which simply transferred the quantities under Special Preferential Sugar quantities from non-LDC ACP Sugar Protocol countries to LDCs, without EU providing any additional quantity, the ACP SP countries had to endure immediate direct losses in terms of revenue.   

Similarly, under the reform of the EU Sugar Regime, the ACP took the brunt of the first sugar price cut which essentially removed the refining margin which was previously included in the ACP guaranteed price while the EC sugar beet producers and OCTs producers are guaranteed hefty direct support, the ACP is being offered the bare minimum price. Now under the EC offer on market access under EPA, the Sugar Protocol countries are again being made to pay a heavy price. 

In making the offer, the EC essentially  

• Reneges on the undertakings and provisions of the Sugar Protocol   ¹
• Reneges on the undertakings under Article 36.4 of the Cotonou Agreement for a joint review of the Sugar Protocol and the safeguarding of the benefits derived there from bearing in mind its special legal status. The Commission threatens to unilaterally denounce  the Sugar Protocol if the ACP do not agree to jointly renounce it
• Reneges on the specific context and rationale of the language mutually agreed for cogent reasons in the Sugar Protocol and Article 36.4 of the Cotonou Agreement.
• Removes the fundamental premise of predictability of the price regime during the life span of the new Sugar Regime ending on 30^th September 2015, which underpins the successful implementation of the respective ACP Multi Annual Adaptation Strategies (MAAS) in violation of Article 30 of the EC sugar regime.   It thus introduces uncertainty to banks, investors and the EIB who are to underwrite the costly investments under the respective ACP MAAS and undermines their implementation.  ²
• In contrast to the overriding objectives of the EPA negotiations to improve on the current market access situation, building on the acquis and ensuring that no ACP state is worse off, the EU offer aims at substituting the SP acquis for a significantly worse trade off.    In reality, the vaunted improved market access contained in the EU offer is on a piece of elastic as far as the non LDC SP countries are concerned.³
• Instead of safeguarding its benefits, the EU offer dismantles the benefits of the Sugar Protocol,  which inter alia include

• its special legal status and provisions
• guaranteed access of individual country agreed quantities
• guaranteed price negotiated annually within the price range obtaining in the EC, taking into account all relevant economic factors
• exemption from the safeguard clause of Lome/Cotonou
• Obligation of the EC to buy agreed quantities as the buyer of last resort
• Indefinite duration of the Sugar protocol irrespective of the life of Lome/Cotonou and
• The EC Declaration on Article 10 of the Sugar Protocol that the possibility of the denunciation under the conditions set out in that Article is for the purpose of juridical security and not representing any qualification or limitation of the principles enunciated in Article 1 of that Protocol (EC undertaking for an indefinite duration to purchase and import  at guaranteed prices agreed quantities of raw or white sugar originating in the SP countries) 

• The EU is yet to explain why they consider the Sugar Protocol, which transposes sugar supply arrangements between the ACP and the Community from the CSA in 1953 to the present day as being incompatible with WTO Rules, the more so as the WTO panel on EU export subsidies on sugar exhorted the EU to honour its long standing sugar obligations towards the ACP and India and the European Community have a separate stand alone agreement on sugar identical to the Sugar Protocol.
• There is no legal basis to denounce the S.P, it is only a political decision by the EC.

 For more information, please contact:

Nidhen Singh, Chairman, ACP Sugar Working Group
Tel:  02 73 9050(Office) - GSM 047536 92 65

Mr Abdourakhmane SAMB, Chief of Protocol & Public Relations, ACP SecretariatTel: 02 743 0611 (Office) – GSM 0476 98 5689

Dr Henry Okole, Chief of Cabinet, ACP Secretariat, Tel : 02 743 0605 (Office) – GSM 04742 309901