Media release

Australian Minister for Trade, Mark Vaile

Friday, 13th October, 2000

Vaile Questions EU on Sugar Policies

Trade Minister, Mark Vaile, today called on the European Union (EU) Agriculture Commissioner, Dr Franz Fischler, to reform the EU's sugar progam.

At the Cairns Group Ministerial Meeting in Banff, Canada, Mr Vaile questioned Commissioner Fischler on the waste and inefficiency of the EU’s sugar industry support policies as identified in a new report by the European Court of Auditors.

"The draft report is highly critical of the cost and administrative inefficiency of the scheme," Mr Vaile said.

"It shows that the EU’s policies result in internal prices for sugar more than three times the world price.

"The report identifies costs to EU consumers from higher prices of 6500 million Euro (A$10.6 billion) and costs in excess of 1600 million Euro (A$2.6 billion) from export subsidies.

"While Australia and other efficient producers have been critical of this program for many years, we now have criticism coming from a source internal to the EU. It follows on from a report earlier this year by the US Government’s General Accounting Office which highlighted the waste and distortions generated by sugar assistance programs in the United States," Mr Vaile said.

Mr Vaile drew Dr Fischler's attention to the presence at the Cairns Group meeting of the Global Alliance for Sugar Trade Reform and Liberalisation, which comprises sugar exporters from Australia, Brazil, Canada, Colombia, Honduras, El Salvador, Guatemala, Nicaragua, Panama, India, South Africa and Thailand.

"I strongly support the Alliance's 'Call For Action' to achieve reform of sugar policies world-wide, especially as the Uruguay Round delivered little if any reform or access to the EU or US markets for sugar," Mr Vaile said.

Mr Vaile also rejected Commissioner Fischler's claims that export and import price differentials suggested that Australian sugar producers were subsidised. This claim is spurious because it compares raw sugar export prices with retail prices for refined sugar.

"Most of our sugar is exported at world prices - a fraction of the price received by EU and US producers. Our market is fully open to imports. If the EU wants to emulate our system, we would welcome that as a significant contribution to world sugar trade reform," he added.

Local Date: Friday, 21-Nov-2008 03:11:00 EST