By Bruno Waterfield - 27th April 2005
Brussels has lost an appeal against a WTO ruling that EU sugar subsidies are illegal ahead of a June shake-up of the sector.
The WTO decision will impact on existing moves by European Agriculture Commissioner Mariann Fischer Boel to reform the EU’s €1.7 billion ‘sugar regime’ on June 22.
“We presented our case forcefully and I had hoped that the appellate body would take greater account of our arguments,” she said.
“Naturally, I will take account of this verdict when I finalise the reform proposals we are due to publish on June 22.”
The WTO has objected to what are regarded as cross-subsidies to sugar exports – including export arrangements to offset 1.6 million tonnes of “preferential” EU imports from African, Caribbean and Pacific countries.
“We will continue to defend the valid interests of sugar producers and consumers in both the EU and the ACP countries,” said Fischer Boel.
“I am determined now to modernise our sugar regime to ensure it has a viable future.”
Australia, one the countries that took the EU to the WTO, welcomed the latest ruling.
“The EU will be required to significantly reduce its sugar exports and expenditure on export subsidies,” said Australia's Trade Minister Mark Vaile.
“Removing up to four million tonnes of subsidised sugar from the world market will make a significant difference to Australian sugar producers who compete on the world stage.”
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