EU Reaches Surprise Deal On Sugar Prices

by Ulrika Lomas, for LawAndTax-News.com, Brussels

28 November 2005

An informal deal has been reached on sugar tariffs by European agriculture ministers, it emerged last Thursday.

Negotiating in Brussels while the ACP-EU Parliamentary Group was meeting in Edinburgh, the EU's agriculture ministers were keen to agree on an improved offer to trading partners on sugar tariffs, seen as a key aspect of the run-up to the crucial WTO Doha Round summit in Hong Kong next month.

Under the deal reached on Thursday, which came as a surprise to many, EU sugar prices will fall by 36% over the next four years, rather than the 39% previously proposed over two years, a deal which had been roundly rejected by the ACP.

EU farmers will receive compensation for 64.2% of their losses, and will have access to a €7.5 billion restructuring fund.

According to reports in the European media last week, only Poland and Greece have expressed strong opposition to the compromise brokered by the UK presidency.

"The rest were not 100 percent happy, but there was widespread support in any case, enough for the presidency to say 'I see we have agreement'," an unnamed EC official told the EU Observer.

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