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STEAMBOAT SPRINGS, Colo., Aug. 8 /PRNewswire/ -- In a panel
discussion at the International Sweetener Symposium here today, top
trade negotiators for the United States and Mexico agreed that
preservation of U.S. sugar policy is the basic goal of their
negotiations concerning sugar and corn sweetener access issues.
Luis de la Calle, undersecretary for international trade
negotiations in SECOFI, Mexico's Ministry of Commerce and Trade,
said, ``We share a desire to preserve the U.S. sugar program. This
is the only way to ensure an orderly transition to the U.S.-Mexican
customs union for sweeteners that the NAFTA (North American Free
Trade Agreement) calls for in the year 2008.'' The customs union
would allow free trade in sugar and corn sweeteners between the U.S.
and Mexico, with a common external tariff.
Greg Frazier, special trade negotiator for agriculture with the
Office of the U.S. Trade Representative, speaking to the Symposium
by teleconference, concurred. He said, ``The defining goal of our
negotiations is to maintain the viability of U.S. sugar policy as we
manage the transition to 2008, and to protect the incomes of sugar
farmers in the U.S. and Mexico'' by shielding them from subsidized
world dump market sugar.
The United States and Mexico have been locked in a dispute for
several years regarding NAFTA provisions on Mexican access to the
U.S. sugar market and U.S. access to the Mexican corn and corn
sweetener markets. Mexico questions the validity of a side letter to
the NAFTA that limits Mexican access to the U.S. sugar market before
2008, and has threatened to request a NAFTA dispute resolution panel
to resolve the issue if negotiations fail. Mexico has also placed
high antidumping duties on imports of U.S. corn sweetener, which
have been ruled to be in violation of World Trade Organization (WTO)
rules.
De la Calle said, ``An agreement must be fair and it must be
comprehensive, covering both sugar and HFCS (high-fructose corn
syrup). For the transition to 2008, we need managed trade of both
products -- limits on Mexican sugar to the U.S. and on U.S. HFCS to
Mexico, with both based on net needs. Substantial trade in both
products would still be feasible.
``An agreement will not be easy but one is possible, and we need to
complete one before October 1, the start of the next marketing
year,'' de la Calle said.
Frazier concurred, saying, ``We have not yet bridged the gap, but
we must do so before the start of the next marketing year. We are in
the final stages.''
Secretary de la Calle said that, in Mexico's view, Mexico should
be permitted to send the United States about 600,000 tons of sugar
in the next marketing year, but the U.S. calculates Mexico's access
at about 120,000 tons. The U.S. market is currently oversupplied
with domestic and imported sugar, and producer prices are at 22-year
lows.
Panelist Jeff Lang, former Deputy U.S. Trade Representative and a
trade advisor to the U.S. sugar industry, said a Mexican decision to
challenge the validity of the sugar side letter ``would not be in
the interest of either country. It would jeopardize the validity of
any agreement reached now. And it would be contrary to Mexico's
stated objective -- it would destroy U.S. sugar policy. Imports of
600,000 tons of Mexican sugar would do this -- contrary to U.S.
domestic policy and contrary to U.S. trade policy.''
Ambassador Lang disputed de la Calle's assertion that Mexico's
surplus sugar problems are the result of imports of U.S. HFCS.
``Mexico has a sugar surplus not because of imports of U.S. HFCS,
but because of subsidies paid to Mexican sugar producers,'' Lang
said. ``These subsidies converted Mexico from a net deficit sugar
producer to a net surplus producer'' after the start of the NAFTA in
1994. Lang referred to statistics for the 6-year periods before and
after NAFTA began showing Mexico's production has increased by an
average of 1.2 million metric tons, while Mexican imports of U.S.
HFCS have risen by only 158,000 tons per year.
Lang said Mexico's debt forgiveness programs have amounted to a
substantial subsidy to Mexican producers. He said, ``Mexico is
distorting the world market with its subsidized sugar exports. It
should not permitted to distort the U.S. market with its subsidized
surpluses.'' Lang also noted that the U.S. Congress would not have
passed the NAFTA without the sugar side letter.
The American Sugar Alliance is the national coalition of farmers,
processors, and refiners of sugarbeets, sugarcane, and corn for
sweetener.
For more information on the American Sugar Alliance, visit
http://www.sugaralliance.org/ .
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