BASSETERRE, St Kitts (AP) - The government of the tiny Caribbean island of St Kitts has decided to shut down its debt-ridden sugar industry after 300 years of production, saying this year's harvest will be its last.

About 2,000 workers began the four-month harvest on Monday.

At one time, nearly one-third of the arable land on the island of some 40,000 residents was devoted to sugar production, and it was the mainstay of the economy until the 1970s.
Since then, tourism has taken over as the main money-earner.

This year, 7,900 acres (3,200 hectares) of state-owned land are expected to produce 12,360 tonnes of sugar.

Rising production costs and falling revenues have left the state-owned St Kitts Sugar Manufacturing Corporation owing local banks some EC$313 million (US$117 million).

"The sugar industry has become like a cancer. If the cancer remains, it spreads; and then it is too late to cure, and the person dies ... I will perform surgery," Prime Minister Denzil Douglas said Tuesday.

St Kitts' sugar is exported to the European Union, which has pledged to conform to World Trade Organisation regulations and cut the price support it gives to Caribbean sugar.

Next year, the price St Kitts receives for its sugar will drop by 37 per cent and further cuts are planned in 2007, Agriculture Minister Cedric Liburd said Sunday, in reference to the EU plan.

"It is unfortunate that after having a sugar industry for some 300 years we have to depart from it," Liburd said.

Douglas assured workers they would be given new job opportunities and that research into alternative uses for sugar cane would continue.

Unemployment in St Kitts is estimated at more than 10 percent, and its national debt has grown to nearly EC$2 billion (US$742 million).

Its main source of foreign exchange is tourism, which, as in other Caribbean islands, slowed down following the September 11, 2001, terrorist attacks in the United States.

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