WASHINGTON (CMC) – A major think thank here has accused the United States of hypocrisy in its sugar policy towards the Caribbean.
The Council on Hemispheric Affairs (COHA) said while Washington pushes economic openness for other nations, including the Caribbean, it “actively employs protectionist policies when it comes to its own closely-held economy,” stating that this is “especially true with sugar.”
COHA notes that the US government “heavily subsidizes its sugar sector, imposes quotas on sugar imports, and then hectors developing countries on the wisdom of cutting back on their own subsidies.”
According to COHA these measures protect private US sugar producers from foreign competition, allowing them to seek “unreasonably high prices” in the US market.
“US consumers are likely to lose from these policies, as they end up paying higher prices at US supermarkets, and, moreover, Caribbean sugar prices also have been adversely affected by US protectionism in the sugar industry.”
COHA says the implementation of sugar quotas by the United States has resulted in “colossal losses” for Latin American and Caribbean sugar economies,” stating that sugar quotas have “often been used for political objectives against Caribbean countries.”
It says that since 1985 “millions of US dollars have been spent—and wasted—in an attempt to revive the sugar industry by poor Caribbean-basin countries.
As a result, sugar industries in Guyana, Jamaica, Barbados, Trinidad and Tobago, and Belize “now face difficulty in exporting sugar due to protectionist US sugar policies.”
COHA notes that, in most Caribbean islands, the Agriculture Production Index, a measure of aggregate agricultural production in a given time period, has been declining in the past few decades because of US farm subsidies.
The think tank states that some advocates of the United States’ sugar policy argue that, in a globalized world, Caribbean countries can target other larger markets, but it adds that European sugar policies are “hardly any different from those of the United States.”
The quota system is another aspect of US sugar policy, as the quantities of imports above the quota limit are subject to “stiff duties.”
“Sugar imports that exceed set quotas are struck with a prohibitively high duty of 16 cents per pound, which is sufficiently high to make sugar imports unprofitable,” it says, pointing that Caribbean countries have “the most restrictive penalties in place, keeping their sugar out of the US market.”
(Many of these are) “impoverished Caribbean countries that have been producing sugar for centuries,” adding that Cuba, Belize, Barbados, Guyana, Jamaica, St. Kitts & Nevis, and Trinidad & Tobago are/were amongst the major sugar producers in the region.
“In a world where global economies are indelibly interconnected, protectionist policies by the United States can have serious ramifications for countries in Latin America and the Caribbean. US consumers would be better off buying lower cost sugar from Caribbean basin countries, and Caribbean farmers living in poverty need fair access to the US market,” says COHA.