| WASHINGTON, (Reuters) - Opponents of the U.S. sugar price
support program on Wednesday urged President George W. Bush to release
Mexico's share of the fiscal 2001 U.S. sugar import quota as a gesture
toward resolving a bilateral trade dispute over sweeteners.
The appeal, made in a letter from the Coalition for Sugar Reform, comes
a week before Bush is scheduled to travel to Mexico for a meeting with
President Vicente Fox.
"This issue will undoubtedly be at the top of the Mexican trade
agenda list," said the coalition, which includes industrial sugar
users and environmental and consumer groups.
In September, the Clinton administration set Mexico's share of the
fiscal 2001 (September-October) import quota at 116,000 tonnes, up
substantially from 25,000 tonnes the previous year.
But to date, Mexico has been allowed to ship only 10,200 tonnes of its
allocation. That was the portion that fell under the so-called "GATT
minimum" U.S. sugar quota of 1.117 million tonnes shared by some 40
countries.
The remaining 105,788 tonnes allocated to Mexico represented the United
States' view of the additional quota that Mexico was entitled to receive
this year under the North American Free Trade Agreement.
However, Mexico has argued it is entitled to ship all of its surplus
sugar, or about 600,000 tonnes, beginning in fiscal 2001, which is year
seven of the NAFTA implementation period.
The difference stems from terms of a NAFTA "side letter".
Mexico says the letter is invalid, while U.S. sugar producers say it was
critical to securing congressional approval of the North American free
trade pact in 1994.
Last year, Mexico said it would ask for a NAFTA dispute panel to
resolve the issue. In the meantime, the United States -- faced with a
domestic sugar surplus and Mexico's refusal to remove steep anti-dumping
duties on high-fructose corn syrup, a sugar substitute -- has refused to
let Mexico ship any sugar under the terms of disputed NAFTA side letter
provisions.
Allowing Mexico to ship the 105,788 tonnes would be a "good faith
gesture" toward resolving the dispute, even though it is considerably
less than Mexico says it is entitled to ship, the coalition said in its
letter.
The coalition also made a larger argument for substantial reform of the
U.S. sugar program, which it called "an unsound and expensive public
policy."
New government estimates show the program will cost over $1 billion
through 2005, the coalition said. U.S. sugar import restrictions also make
it more difficult for the United States to persuade other countries to
open their markets to U.S. products and services, the group said.
Unless the program is reformed, it could block progress on one of the
Bush administration's top goals -- the creation of a Free Trade Area of
the Americas covering 34 countries in the Western Hemisphere, the
coalition said. |