Major Challenges For Sugar Industry

Fiji's sugar industry continues to face major challenges as the EU preferential prices for our sugar are expected to drop by 9.2% in 2008 and 21.7% in 2009.

According to the 2009 Budget Supplement, it stated that as a direct consequence of December 2006, the European Union (EU) suspended aid assistance of $132 million for Fiji's 2008 to 2010 Multi Annual Indicative Programme, until progress on a number of commitments are achieved by the interim government.

This specifically targets the staging of election in early 2009.

The EU's Multi Annual Indicative Programme which focuses mainly on improving on-farm cultivation, developing rural infrastructure and supporting agricultural diversification is critical for the survival of the sugar industry as it embraces the withdrawal of EU preferential treatment.

The Budget Supplement stated that in spite of EU trade pressure, present industry performance is highly worrying with sugar production levels reaching a new low of just 240 thousand tonnes in 2007, due predominantly to mill stoppages and an inadequate supply of cane.

Consequently, the industry was forced to import sugar from India to supply the domestic and regional market as Fiji's total output was only sufficient to meet the EU quota.