Sugar subsidies to be cut

The European Commission has agreed to big changes in sugar trading arrangements. These would lead to a cut in the amount of sugar grown and a lower price offered to EU producers. These proposals have been criticised both by producers and by development agencies. This report from John Moylan

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So unveiling this reform the EU's Agriculture Commissioner Frans Fischler said it recognised the unpleasant truth that an artificially high sugar price in the EU was not economically viable and was bad news for development policy and consumers too.

The new proposals would reduce by about a third the guaranteed price that EU producers receive. The proposals would also cut quotas - or the amount of product eligible for subsidies. That should ultimately lead to a drop in production.

The new system would maintain preferable terms for sugar exports from certain African, Caribbean and Pacific countries - although development agencies claim this seriously disadvantages other nations.

The plans were immediately criticised by sugar producers - the German Sugar Industry Association warned that the proposals threatened the entire future of the EU sugar industry.

And Oxfam and the environmental group the WWF said that the proposals would not reduce poverty or increase environmental standards. They warned the moves would allow continued export dumping on developing countries, thereby undermining poor farmers' livelihoods.

John Moylan, BBC

Listen to the words

enjoy
here, benefit from

some three times
approximately three times more than

tariffs
taxes on goods coming into a country

subsidies
money paid by a government to help support an industry

to dump
to sell extra unwanted produce to other countries at a very low price

artificially high
higher than the true cost of the product

economically viable
capable of operating at reasonable cost, not wastefully

eligible
qualifying for

preferable terms
trade agreements that give certain countries advantages over other countries

undermining
making less secure