All redactions are made under article 4.1(b)
Ref. Ares(2016)2399451 - 24/05/2016
EUROPEAN COMMISSION
Directorate-General for Trade
Directorate D - Sustainable Development; Economic Partnership Agreements - African, Caribbean
and Pacific; Agri-food and Fisheries
Agriculture, Fisheries, Sanitary and Phytosanitary Market Access, Biotechnology
Brussels, 24 May 2016
Trade.dga1.d.3(2016)3013279 -
Minutes meeting Miguel Ceballos Baron – EURODOM on treatment of specialty
sugar in EU-FTA negotiations (04/05/2016)
Participants:
EURODOM/La Réunion: Philippe LABRO, President of “Syndicat du Sucre de la
Réunion”;
, EURODOM (association representing EU outermost
regions)
Commission: Miguel Ceballos Baron (Deputy-Head of Cabinet Malmstrom),
(TRADE D3)
Report:
EURODOM stressed importance of sugarcane chain in the economies of some EU
outermost regions, in particular in
La Réunion, where sugar alone represents 13% of jobs
in the island and 50% of its total exports (two thirds when rum, also produced from
sugarcane, is counted in). Half of the sugar production has now the European consumer
directly as a buyer, and on a less refined status, at price premium (hence this is
designated as “specialty sugar”). The other half is sold for refining into EU mainland as
white sugar, a segment that will become under strong pressure as the EU quotas system is
abolished next year.
EURODOM emphasised the absence of level playing field as regards social costs (wages
represent half of total production costs in outermost regions), referred to be between 6
(Mauritius) to 20 times (Malawi) higher than in competitors in African countries. As a
combination of these factors, border protection remained an essential element to preserve
the outermost region market share (currently 33%) in the premium market, which is only
in expansion when considering the two other segments, “fair trade” and “organic”, with
which specialty sugars compete. Efforts undertaken by Commission on special treatment
for specialty sugar in FTA negotiations, such as the one pursued in EU-Vietnam, are
therefore crucial.
In particular, concerns have been expressed as regards future concessions within EU-
Mercosur, EU-Mexico and EU-Philippines FTAs. Existing FTAs have led to the entry of
Colombia and Central America into the EU specialty sugar segment, via preferential
TRQs provided.
COM took note of EURODOM concerns. As regards “fair trade” certification, COM
recalled that the label is a private standard totally independent from EU authorities, and
Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË - Tel. +32 22991111
Office:
- Tel. direct line +32 229
@ec.europa.eu
encouraged EU banana producers to apply for certification in light of the high level of
labour, environmental and social standards that EU sugar production regions currently
apply. COM also inquired about prospects for organic certification.
EURODOM referred that lack of access to “fair trade” certification schemes for EU
sugar products are linked to the level of subsidies provided by the EU to the sector,
which have led to non-acceptance of requests presented so far. As regards organic, and
similarly to concerns expressed recently by banana producers, there is a lack of adequate
herbicides available for tropical climates. Also, the production system in La Reunion
implies equal treatment of each farmer, and implies the interruption of the refining cycle,
which cannot be done in an economically profitable way considering there are 3 000
farmers delivering sugar to the 2 available sugar plants.
2