Bringing Sweet Reason to Sugar Policy

By May 7, 2007Trade

We recently noted the formation of the Sugar Policy Alliance, an alliance of 70-plus groups created to reform a national sugar policy that raises manufacturers and consumers’ costs through artificial limits on supply.

CQ Today last week had a good piece covering the ins and outs and politics of sugar policy.

Food processors contend that the high price of sugar squeezes profit margins and makes products such as candy and soft drinks more expensive for consumers. The sugar industry counters that wholesale sugar prices have fallen 35 percent since 1980.

But revamping the sugar program became increasingly important to other industries during the 2005 debate over legislation to implement the Central American Free Trade Agreement (PL 109-53). The U.S. refused to open its borders to more sugar imports and the countries party to the treaty — five Central American countries plus the Dominican Republic — retaliated by limiting imports of non-food products and services.

“This is the kind of thing that complicates negotiations” in the World Trade Organization, said William Reinsch, president of the National Foreign Trade Council. “If we have to defend an untenable program, it makes it hard to ask for more significant access in other areas of the agreement.”

Just FYI.