Commissioner Mariann Fischer Boel proposes price cuts of 39% over two years from 2007 for sugar (to €385.5/tonne) and of 42.6% for sugar beet (to €25.05/t); production would also be slashed.

Members of Parliament's Agriculture Committee gave a cautious response to the plans, which will be debated at a public hearing on sugar on 13 July in Brussels. Parliament's rapporteur on the subject, Jean-Claude Fruteau already believes the reform is likely to pose problems to the producer countries.

African, Caribbean and Pacific countries, which currently benefit from the EU guaranteed price system, would have a special aid plan with €40 million in funding for 2006. But Caribbean sugar producers expressed concern: "At the end of the day, the reduction of the price is going to be savage. These are colossal amounts for small and fragile economies," said Ian McDonald, head of the Sugar Association of the Caribbean (SAC). He said that, under the proposal, the Caribbean would lose at least 100 million dollars (82.5 million euros) per year. The Caribbean exports close to 400,000 tonnes of sugar to Europe.

There is heavy pressure on the Caribbean economies to reform their agricultural sectors, which have benefitted (or suffered, as it now turns out) from support programs provided by former colonial masters in sugar, bananas and other sectors.

Speaking last week at the 21st Annual Caribbean Telecommunications Organizations conference on St Kitts, Cable & Wireless (St. Kitts and Nevis), Chief Executive Officers, Ms. Patricia Walters said that the Caribbean nations must urgently transform from traditional agriculture production, to services and information-based economies or they will lose the opportunity to achieve developed nation status. The steady decline of the trade in agricultural products from 42 percent in the 1950’s to 8 percent in 1995, suggests that the growth and future development of the region must revolve around services, she said.

Ms Walters said that in the smaller territories of the Eastern Caribbean services already account for 70% of GDP, and that advanced telecommunications would be the key to achieving a successful economic future: “The understanding and use of information and communications technology have been key contributors to improving our competitiveness in international trade. As barriers to entry are removed and the doors are opened to global competitors, it has become imperative for regional businesses to increase output, broaden market share, develop brand loyalty and emphasize production efficiency to survive the onslaught of globalization and liberalization,” she added.

Ms. Walters instanced the operations of the Eastern Caribbean Securities Exchange (ECSE) in St. Kitts and Nevis: “Just as markets have moved towards the use of electronic finance channels to bypass the traditional requirement of customer proximity, the ECSE provides the ideal competitive platform for attracting foreign investment across eight countries in the Caribbean,” she said.