Azara Blog: EU finally agrees to reduce sugar subsidies

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Date published: 2005/11/24

The BBC says:

A reduction in subsidies for Europe's sugar farmers has been agreed by European Union agriculture ministers, officials in Brussels have confirmed.

They have agreed to cut the prices offered to European sugar farmers by 36%, bringing the EU's sugar rules into line with global frameworks.

The changes were demanded by the World Trade Organisation, but EU farmers and sugar firms have warned of job losses.

The EU had been paying Europe's sugar producers three times the world price.

A spokeswoman in Brussels said the "deal has been done" on the basis of "a large qualified majority" of the ministers - in other words, by votes allotted according to states' population but weighted in favour of smaller countries.

EU farmers wishing to abandon growing sugar beet will now be offered compensation amounting to 64.2% of revenues lost due to the price cuts.

The agreements follow three days of marathon talks.

At present, the EU pays about 1.5bn euros ($1.8bn, £1bn) annually to support the sugar sector.

Change was demanded of the EU after the WTO ruled earlier this year that its existing 40-year-old guaranteed pricing system was illegal.

About bloody time. This was one of the classic EU farm scandals.

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