is any clear link between preferential imports and the permitted exports is that EU policy has
sought ‘autarchy plus’; it has set production quotas that exceed self-sufficiency. This has
necessarily resulted in exports in excess of the level of imports
With both the WTO panel and the Appellate Body finding against the EU, these exports have
to be reduced by 2.8 million tonnes. This is not to achieve an efficient domestic market but
simply to comply with the Agreement on Agriculture which permits the EU to continue to
subsidise exports of up to 1.3 million tonnes. Removing subsidised exports altogether, as the
EU has promised to do by 2013 in the Hong Kong Ministerial Declaration, would require a
further 1.3 million tonnes of cuts to supply, and if this were achieved through price cuts that
were not offset (wholly or partly) by increased subsidies to EU producers through other
means, part of the cut would probably fall to imports and part to domestic production
according to their relative costs of production.
Economic Partnership Agreements (EPAs)
The Cotonou trade regime expires in 2007 and the current plan is to replace it with a set of
EPAs negotiated with ACP sub-regions. At present six regional negotiations are under way.
Neither the Sugar Protocol nor SPS are formally part of the Cotonou trade regime (and EBA
is completely separate). None the less it seems likely that some change will be needed to the
Protocol (which is included in the text of Cotonou despite its legally separate identity) in
order to adapt it to a post-2007 system in which signatories are spread between several EPAs.
some of which may also include sugar-producing LDCs eligible for EBA.
The Commission has proposed that the ‘Sugar Protocol be integrated into EPAs in such a
way that does not prejudice the EU’s commitment to LDCs for full market access for sugar
from 2009 and that ensures full compatibility with WTO rules’.9 This will be covered by the
review of the Sugar Protocol, to be negotiated jointly with the ACP in the framework of EPA
negotiations.
Three questions need to be asked concerning the volume and price of allowable ACP exports.
There is a strong expectation that the EU will offer ‘EBA-style’ unlimited free access to its
market for all the exports of EPA members; will this also apply to sugar? If it does, will any
price guarantees still apply?
If some supplies are made through the Protocol, its price provisions would remain effective
(unless all parties agreed to change). But it is not certain that any exports will be made via the
Protocol - or at least not for ever. Whilst the Protocol is of ‘indefinite’ duration this is not
necessarily the same as ‘unlimited duration’; the term means merely that neither a minimum
nor a maximum duration are specified. In other words, the Protocol might cease to exist.
There is no logical reason why ‘EBA equivalence’ should offer Protocol guarantees to
exports from non-signatories or, if the Protocol continues, to its signatories for amounts in
excess of their quota. It might be considered mutually advantageous for guarantees to be
offered (and there is nothing in the Protocol to prohibit this); as noted above, EBA has
operated so far in a way that confers similar (although slightly lower) price benefits to LDC
exporters. But it is hard to see how the EU could make such an offer for an unlimited volume
of ACP exports.
CEC 2005a: 8
10