BRUSSELS, Belgium (AP/Observer) – Jamaica yesterday vowed to step up its lobby against the European Union’s proposed huge cut in the price it pays for sugar after Brussels announced sweeping changes yesterday to its 40-year-old system for protecting sugar growers, despite criticism from domestic producers and exporters from some of the world’s poorest nations.

“It is now quite clear that all our focus must be shifted to the decision-makers – the member states (of the EU),” Jamaica’s foreign trade minister, K D Knight, told the Observer from Brussels. “Our efforts to persuade the commissioners have not borne fruit and our lobbying efforts have to continue.”

Knight and other Jamaicans had gone to Brussels for an 11th hour effort to prize a better deal for poor countries like Jamaica that enjoys a preferential market in Europe, but the reform package unveiled by the European Commission brought no joy and hardly varied from the information that has been dripping out for more than a year.

The proposal will cut guaranteed prices to European producers by 39 per cent following a successful challenge to the subsidy system at the World Trade Organisation by Australia, Brazil and Thailand.

Such cuts face fierce resistance from European beet sugar producers and poor nations in Africa and the Caribbean, including Jamaica.

“There is no alternative to a profound reform,” said EU Agriculture Commissioner Mariann Fischer Boel. “EU sugar producers have a competitive future, but only if we act now and act decisively to prepare them for the challenges ahead.”

She said failure to change would lead to a “slow and painful death” for the European industry.

The WTO ruled in April that the EU’s system of subsidies to guarantee high prices for European sugar producers was illegal. It agreed with Brazil, the world’s biggest producer, which argued that the EU system depressed world prices and made it impossible for others to compete.

EU sugar prices are more than four times higher than the global market rate and are protected by import tariffs. Brussels also pays out export subsidies to get millions of tonnes of sugar a year off its market, helping to keep EU prices high and support Europe’s farmers.

However, the EU system also grants preferential treatment to sugar producers in the African, Caribbean and Pacific (ACP) group of countries with which Europe has an agreement in perpetuity.

These countries fear their industries will be devastated by changes that would slash guaranteed prices and open them up to competition from major world producers. In Jamaica, with its relative small farms and factories in need of major investment for modernisation, the demise of the sugar industry could cost up to 40,000 rural jobs.

“Today’s proposals will hurt many farmers in poor countries,” said Luis Morago, spokesman for the aid group Oxfam. “The steep, sharp price cut will be very damaging for poor African countries and the overall reform package doesn’t guarantee an end to EU overproduction and dumping.”

The issue will be a major item on the agenda of Caribbean Community (Caricom) leaders when they meet in St Lucia next month, the organisation’s secretary general, Edwin Carrington, said yesterday.

Yesterday, Derrick Heaven, the head of the Sugar Industry Authority (SIA), said that Jamaica and its ACP partners had to do a lot of work between now and November – when the commission expects European farm ministers to endorse their proposal – “to ensure the best possible deals out of the reform that is being proposed”.

“We have to survive and we have to do what we need to make sure that we don’t get left behind in the rush,” said Heaven, who was also in Brussels.

“Now we have to put on our running shoes and get busy,” said Karl James, the manager of Jamaica Cane Products, the agency that markets the island’s sugar.

Poor nations are urging the EU to phase in price cuts over 10 years to allow the farmers’ producers to adapt to the market changes. Oxfam said the commission’s offer of euro40 million (US$48 million) compensation to 18 poor sugar-exporting nations next year was inadequate and called for at least euro500 million (US$600 million) a year.

Fischer Boel said the EU would help ensure those countries could continue to find markets in Europe. But a statement from ACP exporters said the changes would hit them hard and appealed for more time to adjust.

“No business could sustain that price cut almost overnight, least of all operations in (our) fragile economies,” they said.

“This is a tragedy for us,” said Mauritius’ Agriculture Minister Nandcoomar Bodha. “It seems that the commission has an obsessive agenda to destroy sugar economies in small island vulnerable states and landlocked developing economies.”

He said poor producers would lobby intensively to persuade EU governments and the European Parliament to change the proposals.

Britain, which holds the EU presidency in the second half of 2005, welcomed the proposals, but they face opposition from Ireland, Italy and Portugal, where producers have warned the reforms threaten to wipe out local sugar industries.

“Such price cuts of over 40 per cent would be intolerable and would devastate beet growing in Ireland,” Jim O’Regan, sugar beet chairman of the Irish Farmers Association, said last week after details of the plan were leaked.

Under the commission’s proposals, the cuts will be introduced in stages, taking the guaranteed price from the current level of euro631.9 (US$764.1) per metric tonne to euro385.5 (US$466.1) by the 2009-10 season. European farmers will get compensation payments to cover around 60 per cent of the cuts and special restructuring funds would be offered to farmers that want to switch to other crops.

Around 325,000 European farmers grow sugar beet, with France, Germany and Poland being the biggest producers.