WTO cotton ruling bad omen for EU sugar
Stabroek News
May 7, 2004
The World Trade Organization (WTO) ruling on US cotton subsidies in Brazil's favour leaves nothing for the Caribbean or Guyana to cheer about.
On April 26, the WTO in a preliminary ruling accepted a complaint by Brazil that subsidies paid by the US administration to cotton farmers were contrary to the international trade rules with a formal announcement expected on June 18.
David Jessop, executive director of the Caribbean Council for Europe, in this week's Sunday Stabroek argues "the ruling if confirmed, has a direct relationship with aspects of a separate WTO complaint brought by Brazil, Australia and Thailand against the EU on Sugar. "This argues that the production and export subsidies granted under the European sugar regime to EU beet farmers are in contravention of WTO rules," he says.
If Brazil is also successful in this case, it is likely that among those to suffer would be the Caribbean (and Guyana) as by extension it benefits from the price linkage in the European Union/African Caribbean Pacific sugar protocol, says Jessop.
This protocol guarantees ACP producers the same subsidised prices paid to European producers. These prices are much higher than those that prevail on the world market.