TRADE-MAURITIUS:
EU Assisting in Revamp of Sugar Cane Industry
Nasseem Ackbarally
PORT LOUIS, Mar 27 (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.
(END/2007)
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