President Urged To Drop CAFTA Concessions

Published online: Jan 15, 2004 U.S. Sugar Industry
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Seventy-two sugar companies and organizations in 19 states have written President Bush to request that he meet with industry leaders and withdraw the concessions on sugar contained in the proposed Central American Free Trade Agreement. The letter stated that unless sugar is pulled from the trade agreement, the U.S. sugar industry will strongly oppose Congressional passage of the CAFTA. The letter, sent to the White House January 14, stated in part: "We are deeply disappointed by the commitments on sugar contained in the proposed agreement recently announced with four CAFTA countries. "These commitments, and their anticipated expansion in negotiations with Costa Rica and the Dominican Republic, would result in substantial additional imports into an already over-supplied domestic sugar market, threatening the viability of both the U.S. sugar program and our industry. "Moreover, they would set a precedent for other FTA negotiatons that would lead to a totally unmanageable level of imports into the United States. "These increased imports can only come at the expense of U.S. sugar producers, who are already suffering from low market prices and are required to hold 700,000 tons of 'blocked stocks,' in order to avoid massive forfeiture to the government. "We strongly urge you to direct your Administration to reconsider and reverse the commitments on sugar offered in the proposed CAFTA and to complete a careful and comprehensive analysis of the impact of any commitments on sugar market access in all FTAs before any further negotiations on sugar take place. "We are certain such an analysis will lead to the conclusion that USTR's current approach in FTA negotiations is neither viable nor consistent with the Administration's stated position on domestic support policies. "Any threat to the operation, or the extension of current U.S. sugar policy, such as that posed by the commitments in the proposed CAFTA,is a direct threat to the survival of our industry, and will require American sugar producers to strongly oppose CAFTA and any other FTA with comparable provisions." In conclusion the letter stated that sugar must be reserved for the global, comprehensive Doha negotiations of the World Trade Organization and not included in FTA negotiations. This is the only approach that can ensure a fair and acceptable outcome for the U.S. sugar industry.