PRIME Minister PJ Patterson appealed last Tuesday to the last sitting of Parliament he was scheduled to attend as leader of the governing People’s National Party (PNP), for consensus on the future of the sugar industry.

“I beg of Parliament, let us treat this thing with the national unity that it requires,” Patterson said, responding to questions on sugar from the Leader of the Opposition Bruce Golding.

He said that even while “campaigns” were taking place “all over the place” the issue was too important “for us to muff this chance.”

“I would like informed discussions taking place at this time about the future of the industry, because it is not confined only to sugar producing areas. It is going to have an effect right through the length and breadth of Jamaica and it is going to affect the social fabric of our society,” the prime minister warned.

In answering the questions raised by the Opposition Leader, he said that a mission, led by Guyana’s President, Bharrat Jagdeo, is heading to Europe again to discuss sugar.

The mission “will focus on how we preserve the benefits of the sugar protocol; the quantum of financial resources required for the action plans submitted by the six Caricom sugar protocol countries; and the need for front-loading of disbursements and an appropriate fast-track for disbursement,” said the PM.

Patterson said that that to-date the European Commission has only committed to the release of euro40 million for adjustment assistance, although it has spoken of euro190 million per year for the period 2007-2013.

There is no agreement yet on the final package, though estimates of the quantum of assistance needed by all ACP sugar producers vary between euro250 million and euro500 million per annum.

He said that the matter was considered by European parliamentarians who reiterated the need for more moderate reductions in the price of white and raw sugar, and called for new and additional funding for the accompanying measures in the ACP adjustment plan.

That having been said, however, it is disappointing that the parliament itself only suggested a figure of euro200 million, he added.

“So there is a large divide between what is being contemplated so far from Europe and what would be regarded as acceptable to the ACP countries,” the prime minister said.

“There is, however, a further point. It is my contention, and that of other Caricom colleagues, that it is not a matter for the EU to just decide by itself on what should be offered to ACP countries. It is my contention that we are entitled to compensation no less than that which is being afforded to EU farmers who are being induced to get out of sugar production.”

Golding noted that last October, the EU commissioner for agriculture had advised that EU transition funding to assist sugar producing countries was intended to do one of two things: for those countries who were marginally uncompetitive, it was to enable them to become competitive; and for those who were far out of line in terms of their competitiveness, it was assistance to get out of sugar.

The two men had the following exchange:

Golding: If we follow the logic of the prime minister’s reasoning, it would mean that an assessment would have to be done of Jamaica’s productivity and a determination made as to whether Jamaica should stay in sugar or get out.

My question is, is there any indication from the EU, consistent with the statement that the (commissioner) made, that conditionalities are going to be attached to the provision of this assistance in terms of whether we are to remain in sugar, or whether we are to get out of sugar and use those funds for the purpose of diversification or reorientation of our farmers?

Patterson: We do not base our approach at this time on an acceptance without question of the position postulated by the EU. What the commissioner has said reflects their position, to date.

We are seeking to identify whether that opinion is in fact sound, in terms of the treaty obligations which we regard as being in place between Europe and ourselves.

Golding: If we are insisting that under the treaty we are entitled to similar treatment to beet farmers, and the EU is saying to beet farmers, ‘here is a package of money, stop planting beet’ – on what basis are we going to claim equal treatment without accepting equal conditionalities?

Patterson: It goes back to circumstances which have caused the EU to induce its farmers to get out of beet production for export. The sugar protocol entitles ACP countries to export, to Europe, 1.4 million tonnes of raw sugar per year.

No suggestion has come from the EU that that quantum should be reduced. What is at issue is the price they should pay for the sugar which they are importing from us and our contention is that when we concluded the negotiations, the EU said very clearly, ‘don’t expect us to pay you more than we are paying our own beet farmers’.

We said we were entitled to receive a price no less than is paid to your farmers. To make that possible, in addition to the price that was stipulated, we had to get some shipping costs and there was also a refining margin.

We are saying to the EU, if you are dropping the price to your farmers, by way of giving them an upfront cash inducement to reduce the amount they are producing, which is part of the price that you would have paid, we also are entitled to the equivalent by way of compensation.

It is then for us to determine, having got compensation, whether we use it to make the sugar industry more efficient or whether we use that for diversification in areas where we do not expect improved efficiency.

balfordh@jamaicaobserver.com