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Thursday, 22 August, 2002, 14:21 GMT 15:21 UK
Europe rejects sugar 'exclusion' charge
EU - harsh on poor sugar producers, says Oxfam
Oxfam says the EU is too hard on poor sugar farmers
The European Union has rejected an accusation from the British development charity, Oxfam, that it is unfairly excluding sugar farmers in developing countries from European markets.

Oxfam says the EU's sugar policy makes profits for Europeans while keeping developing countries poor, and is calling for an immediate 25% cut in EU sugar quota production.

But an EU spokesman, Thorsten Muench, said the bloc was taking the lead in opening its sugar markets to the Third World.

He said the EU had imported 850m euros ($833m) of sugar from developing countries in the year 2000, more than the combined total imported by the United States, Japan, Australia and Canada.

Mr Muench also rejected criticism from Australia and Brazil, who are to challenge European sugar subsidies at the World Trade Organisation.

No reform proposals

In a report on the EU Common Agricultural Policy's (CAP) sugar regime entitled The Great EU Sugar Scam, Oxfam says no agricultural sector stands in greater need of radical reform.

The sugar regime is a clear example of Europe's blatant hypocrisy in dealing with developing countries

Phil Bloomer
Oxfam
But the sugar industry has not been included in the European Commission's latest reform proposals.

The report is released days before the start in South Africa of the World Summit on Sustainable Development (WSSD), where world leaders will attempt to agree a plan to reduce world poverty.

Oxfam says Europe's subsidised over-production of sugar is having a "devastating impact" on the poor world, ensuring big profits for the EU's large farmers and sugar processors, but "undermining opportunities for people in the developing world to work their way out of poverty".

"The sugar regime is a clear example of Europe's blatant hypocrisy in dealing with developing countries," according to Phil Bloomer of Oxfam.

Oxfam says that quotas and tariffs set Europe's sugar prices at almost three times the world market price, meaning huge subsidised surpluses are dumped annually overseas, depressing world prices and pushing other exporters out.

According to Oxfam's analysis, the EU is one of the world's highest-cost sugar producers, but also the world's biggest white sugar exporter, with 40% of the 2001 total.

Producers from outside the EU, some of them from very poor countries, face a tariff of 140% on exports destined for Europe. At the same time, Oxfam says, the World Bank and the IMF have been pressurising developing countries to cut their own sugar import tariffs.

The sugar regime costs EU consumers and taxpayers 1.6bn euros ($1.57bn) annually, it says.

Impact in Africa

One of the world's lowest-cost sugar producers is Mozambique, where almost 75% of the rural population live in extreme poverty.

Almost entirely shut out of the EU sugar market, Mozambique has lost the chance to earn an estimated 108m euros ($106m) from sales by 2004.

The EU's annual development aid to Mozambique is 150m euros ($136m).

 WATCH/LISTEN
 ON THIS STORY
The BBC's Matt Prodger
"The timing of the Oxfam report is no coincidence"
Oliver Buston, Oxfam International
"Europe needs to stop exporting sugar"
Kate Rayworth, author of the Oxfam report
"Because of subsidies Europe over-produces sugar"

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26 Jul 02 | Business
29 Apr 02 | Business
12 Feb 03 | Business
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