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EU to tackle sugar reforms amid bitter trade talks


BRUSSELS, Nov 20 (AFP): The European Union kicks off marathon talks Tuesday on sugar sector reforms required by the WTO as the bloc's trading partners look to Brussels to sweeten offers on agriculture in bitter world trade talks.
The European Union's executive commission is trying to overcome resistance from some member states to the reforms, which the World Trade Organisation has ruled illegal following a complaint from Australia, Brazil and Thailand.
"It is crucial that we reach a decision next week. The negotiations will be tough, but I urge ministers to be bold," EU farm commissioner Mariann Fischer Boel said Friday.
At the moment, the EU offers a guaranteed price for sugar that is paid for, in effect, by consumers, with Brussels buying from producers at about three times the average world market price.
The European Commission's plan is to cut the guaranteed price by 39 per cent over two years from 2007 and offer a voluntary compensation scheme for producers forced out of business by the price cut.
The EU was forced to reform its nearly 40-year-old existing sugar policy, after the system was declared illegal earlier this year by WTO arbitrators.
Although the issue of the EU reforms of its sugar industry are not directly linked to trade talks in the run up to the mid December WTO ministerial meeting in Hong Kong, Brussels stresses that a sugar deal would boost broader trade negotiations.