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Reform in the EU Sugar Regime: Impact on the Global Sugar Markets

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  • Huan-Niemi, Ellen
  • Kerkela, Leena

Abstract

The ongoing trade negotiations, unilateral trade concessions and obligations under the WTO are pushing the EU sugar regime to undertake reforms. These reforms will alter the positions of developing countries in the global sugar markets. A complete unilateral liberalisation of the EU sugar sector is simulated to depict the winners and losers in the global sugar markets if no preferences are governing the imports of sugar into the EU. The supply responses, which strongly affect the outcomes, are dependent on both the nature of substitution for sugar as well as on the efficiency of sugar production in different countries. The multiregion general equilibrium framework (GTAP) is used for this analysis. The results show that the total liberalisation of sugar imports from the LDCs will be a major threat to the EU sugar regime. The current regime limits sugar imports from all developing countries or some efficient producers, if the production cost data is a right estimate of the potential supply response from developing countries. The LDCs will be the winners under the EBA concession supported by the current regime, but a few efficient sugar producers will be the winners if the current regime is entirely liberalised.

Suggested Citation

  • Huan-Niemi, Ellen & Kerkela, Leena, 2005. "Reform in the EU Sugar Regime: Impact on the Global Sugar Markets," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24733, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae05:24733
    DOI: 10.22004/ag.econ.24733
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    References listed on IDEAS

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    1. Stephen Devadoss & Jurgen Kropf, 1996. "Impacts of trade liberalizations under the Uruguay Round on the world sugar market," Agricultural Economics, International Association of Agricultural Economists, vol. 15(2), pages 83-96, November.
    2. S¯ren E. Frandsen & Hans G. Jensen & Wusheng Yu & Aage Walter-J¯rgensen, 2003. "Reform of EU sugar policy: price cuts versus quota reductions," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 30(1), pages 1-26, March.
    3. Huan-Niemi, Ellen & Niemi, Jyrki S., 2003. "The Impact of Preferential, Regional and Multilateral Trade Agreements: A Case Study of the EU Sugar Regime," ENARPRI Working Papers 25134, European Network of Agricultural and Rural Policy Research Institutes (ENARPRI).
    4. Devadoss, Stephen & Kropf, Jurgen, 1996. "Impacts of trade liberalizations under the Uruguay round on the world sugar market," Agricultural Economics, Blackwell, vol. 15(2), pages 83-96, November.
    5. Poonyth, Daneswar & Westhoff, Patrick & Womack, Abner & Adams, Gary, 2000. "Impacts of WTO restrictions on subsidized EU sugar exports," Agricultural Economics, Blackwell, vol. 22(3), pages 233-245, April.
    6. Ellen Huan-Niemi & Jyrki Niemi, 2003. "The impact of preferential, regional and multilateral trade agreements: a case study of the EU sugar regime," ENARPRI Working Papers 001, ENARPRI (European Network of Agricultural and Rural Policy Research Institutes).
    7. Arvind Panagariya, 2000. "Preferential Trade Liberalization: The Traditional Theory and New Developments," Journal of Economic Literature, American Economic Association, vol. 38(2), pages 287-331, June.
    8. Bhagwati, Jagdish & Greenaway, David & Panagariya, Arvind, 1998. "Trading Preferentially: Theory and Policy," Economic Journal, Royal Economic Society, vol. 108(449), pages 1128-1148, July.
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    Cited by:

    1. Nikolaos Sariannidis, 2010. "The Impact of Stock, Energy and Foreign Exchange Markets on the Sugar Market," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 3(1), pages 109-117, July.
    2. Jo Lorentzen & Anton Cartwright & Charles Meth, 2010. "Trade Liberalization, Rural Poverty and the Environment: A Case Study of Sugarcane Production in the Incomati River Basin in Mpumalanga, South Africa," Chapters, in: Jonathan A. Cook & Owen Cylke & Donald F. Larson & John D. Nash & Pamela Stedman-Edwards (ed.), Vulnerable Places, Vulnerable People, chapter 6, Edward Elgar Publishing.

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