Africa, Development & Aid, Economy & Trade, Energy, Environment, Global Governance, Headlines, Poverty & SDGs, Trade & Investment, Trade and poverty: Facts beyond theory

TRADE-MAURITIUS: EU Assisting in Revamp of Sugar Cane Industry

Nasseem Ackbarally

PORT LOUIS, Mar 27 2007 (IPS) - Sugar cane has been associated with Mauritius for over 367 years, shaping many aspects of the history and culture of the island state. The arrival of renewable energy technologies has made sugar cane even more important to the Mauritian economy.

The government of Mauritius is redeveloping the cane industry to produce more white and special sugars, ethanol and other by-products. The idea is to have an industry which contributes effectively to the energy security of the island and which quickly responds to market demand.

Central to this development is Mauritius’ relationship with the European Union (EU). European states signed a trade protocol on sugar with African, Caribbean and Pacific countries (ACP) in the 1970s. In terms of the agreement, Europe has committed itself to importing a minimum amount of sugar duty-free from these countries at a guaranteed price.

Last year, sugar exports from Mauritius filled the equivalent of 38 percent of this quota. This preferential access to the EU market has translated into Mauritius receiving an additional 4 billion euros over and above the world market price for sugar between 1975 and 2005.

‘‘Mauritius is by far the foremost beneficiary of the sugar protocol. It presents a subsidy to the Mauritian economy which equals around 120 euros per inhabitant per year,” said Claudia Wiedey-Nippold, head of the EU delegation in Mauritius.

Mauritians have been content with the EU arrangement over the years. But the EU has decided to do away with the preferential treatment of ACP states in trade relations. The price for sugar from the ACP states will be cut by 5 percent in 2007; 17 percent in 2008; and 11 percent in 2009. This step has forced the island state to reform its sugar cane industry.

The Mauritian government has developed a plan of action to this end. Mauritius will continue to produce 520,000 tons of sugar annually to utilise the remaining preferential benefits of the protocol.

Seven out of the eleven existing sugar cane factories will be closed. The remaining ones will be transformed into flexi-factories with a production capacity of more than 100,000 tons of sugar per year.

Five coal plants producing electricity all year round will be built. Two distilleries will be added to produce about 30 million litres of ethanol from 120,000 tons of cane molasses. The ethanol will be used with gasoline in a 20/80 ethanol-gasoline blend.

Mauritius is increasing the total acreage under sugar cane from 50 to 81 percent of total land cultivated. An additional 7,000 hectares will be placed under irrigation. Small farmers will be reorganised to increase their yield. A voluntary retirement scheme is available to support those factory workers who will lose their jobs.

Agro-industry minister Arvin Boolell told IPS that ‘‘these reforms will not only enable the Mauritian sugar cane industry to sail safely in the future. It will also enable us to continue cultivating a crop which is an invaluable asset as a renewable, environmentally friendly energy source.

‘‘The industry has the potential of being an efficient multi-product bio-factory for the generation of value-added produce, including pharmaceutical products, vaccines and textiles,” Boolell emphasised.

He said a key concern is that Mauritius remains competitive. Sugar-producing countries like Brazil are very aggressive in the world market. ‘‘Mauritius will have to find alternatives to stay in the race,” he added.

The reforms will be done with assistance of the EU worth 301 million euros. Boolell told IPS that, ‘‘the accompanying measures from the EU will be in the form of budget support”.

The EU has asked Mauritius for a coherent energy policy for the production of electricity before disbursing the first instalment, according to Mauritian finance minister Rama Sithanen. ‘‘Mauritius will have to adhere to a set of quantified selected performance criteria which will be established during the next six months.

‘‘This includes the de-rocking of fields to increase productivity and the centralisation of three factories before the 2007 harvest season that starts in July. We also have to quantify the number of workers that will be retrenched because of the centralisation as well as the total number of people who will need the voluntary retirement scheme,” said Sithanen.

The government is also planning to retrain and re-skill workers.

Wiedey-Nippold has explained that the EU will not disburse any money to Mauritius unless the conditions are honoured. The strategy should elaborate more on clean energy compared to the coal option. The Europeans are not positive about the latter because it pollutes the environment.

According to Wiedey-Nippold, the EU delegation has not yet received any official document from the government on the energy policy. An official at the ministry of public utilities told IPS that a strategy has been drafted for the production of electricity until the year 2025, building on the current one that ends in 2010.

It will soon be submitted to the EU’s diplomatic representatives in Mauritius.

 
Republish | | Print |


where can i read the summer i turned pretty book