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EU-Swaziland: farmers brace for life without their sugar daddy


Friday, 15 September 2017

EU-Swaziland: farmers brace for life without their sugar daddy

With the EU set to lift caps on sugar production, African producers could be squeezed out of a market that has propped up places like Swaziland for years. When the European Union deregulates its sugar market at the end of September, some of the biggest losers will be in the lush hills of this tiny, landlocked nation. More than 8,000 miles from Brussels, Swaziland’s sugar farmers for over a decade have benefited from the EU’s tight grip on domestic production of the sweetener. Caps on annual production in European countries helped keep prices artificially high and created a market for imports, especially from poor countries that are freed from tariffs. Currently, more than half of the EU’s raw sugar comes from Africa. “It was so easy,” said Oswald Magwenzi, managing director of Ubombo Sugar, one of three sugar mills in Swaziland. “People used to always say in the sugar industry, sell 50% [regionally] and 50% to the EU and go fishing. It was lucrative.” But with EU production limits set to fall away on September 30, governments and sugar associations expect farmers from France to Poland to boost production and cut their costs. That would largely crowd out producers such as Swaziland, one of the world’s few remaining absolute monarchies. The US Department of Agriculture forecasts that in the year after the caps are removed, EU sugar production will be 30% higher than it was in the 2015-16 season.

Source: www.businesslive.co.za