Sweeter state? Mauritius better positioned than smaller ACP countries
The island economy is relatively well placed to face the end of the EU sugar quotas as it started investing in related diversification such as producing electricity and bioplastics from sugar cane several years ago. (Image: Omnicane)
Mauritius and Fiji are better positioned than other smaller African, Caribbean and Pacific Group of States (ACP) to produce electricity and bioplastics from sugar cane as both started investing in this related diversification several years ago.
A proposal to ensure the viability of ACP states’ sugar industries has estimated that almost US$20 million would be needed for research on sugar, once the EU sugar quota draws to an end in 2017.
The sugar quota system sets out how much sugar each of the 19 European producer countries can produce per year and what they can do with the surplus, and the ACP has firmly opposed the EU’s decision to end sugar quotas.
ACP countries apprehend that this change will lower sugar prices and that small producers might be affected by ensuing market instability that gives a competitive advantage to bigger producers and create more robust producers such as Brazil.
In addition, the cap on EU sugar production will be lifted, as Europe will turn from a net importer to a net exporter. Hence, Mauritius will be seriously affected because it has the biggest quota for exporting sugar to Europe.
Accordingly, to compensate some of the potential economic losses posed to smaller sugar exporters such as many of the Caribbean islands, the Sugar Research and Innovation Programme is accepting grant proposals until the end of this month.
According to Jean-Cyril Dagallier, who runs the unit that coordinates the programme, the two factors contributing to these losses are: the end of EU sugar quotas in 2017 and the rise of big producers such as Brazil.
Dagallier stated that the goal behind the sugar research program is to alleviate these effects by funding research into more productive sugar crops and into new, potentially more lucrative products that can be made from sugar cane.
Last month, the ACP called for the second phase of the research programme – project proposals- to prevent potential damage to its members’ sugar industries and to fund 13 projects during 2014 and 2015, while the first phase of the research programme funded 16 project in 2012 and 2013.
As said by Dagallier, the EU, Australian Aid, United States and the ACP countries contributed to the programme’s joint budget of nearly US$ 19.6 million which intends to stimulate several types of sugar research, as well as ways to improve sugar production with new and more disease-resistant varieties of sugar cane.
Also, ways of producing ‘green’ products such as cellulose and lignin, from polymers present in the sugar cane will be examined.
“ACP countries are at the very beginning of this new path. They have ideas and some of them are already working on pilot projects to produce bioplastics,” says Dagallier.
“Mauritius is a big sugar cane actor because they have a new sugar policy, new factories and the greatest amount of experts involved in this kind of research,” he added.
Fiji’s sugar industry is also well placed as it has successfully studied sugar cane genetics and discovered new, more disease-resistant varieties, improving yield and sugar quality.
However, as both Mauritius and Fiji need new factories and equipment, it will take them around a decade to start showing returns on their investment.
Dagallier expressed the hope that ACP member states will accelerate investments to quickly identify new sugar cane products as abolition of EU quotas is imminent.
Caribbean economies are small countries, with not too much land, he noted. If this source of income is cut, these economies would go into a decline, he warned.