NUKU’ALOFA: The future of Fiji’s ailing sugar industry is in limbo after the decision by the European Union (EU) last month to unilaterally scrap the 32-year-old Sugar Protocol.
The Sugar Protocol set up in 1975 between the EU and members of the African, Caribbean and Pacific (ACP) sugar producing countries had offered ACP access to the EU market and a guaranteed price of sugar for an indefinite duration
According to Dr Roman Grynberg, Forum Secretariat’s Director Economic Governance, the EU decision means Fiji has to look for other alternatives to sugar.
“Fiji has two years now which an interim arrangement was in place, the price of sugar was expected to fall quiet dramatically.
“Fiji had set in place programmes that would address that but I think one had to be honest that when your main staple export suffers from what will certainly be a serious decline in prices, it was serious,” he said
Dr Grynberg said the scrapping of the Sugar Protocol would also affect the island nation’s economy.
“It will have adverse consequences in the Fiji economy. I don’t think anybody can say otherwise.
“Fiji is going to go through a difficult and painful transition to new export sectors. But there are some emerging products like pawpaw, which is successfully exporting, that will earn high income.
“We need now to move away from our dependence from our preferential markets. We are going to look at other market opportunities and take advantage of them,” he said
The World Trade Organisation (WTO) rules had required a renegotiation of the EU/ACP pact to ensure compliance but ACP countries had always been assured that benefits under the Sugar Protocol would still exist.
The EU statement last month stated “the arrangements of the Sugar protocol have served its interest of both ACP states and EU community, by guaranteeing ACP exporters an outlet to profitable market and ensuring a regular supply for cane sugar refiner … however, the arrangements of the sugar protocol can no longer be maintained”. – PNS