| MEXICO CITY (AP) -- Mexico created a nationwide sugar authority
Wednesday that will oversee the management of 27 struggling mills seized
by the government last month.
The new Sugar Sector Co. will complete the 2001-02 harvest, scheduled
to begin in mid-November, and eventually oversee the re-privatization of
the mills, the Agriculture and Finance departments said in a joint
statement.
There were fears that last month' s bailout and management
restructuring would affect the new harvest. The sugar industry is Mexico'
s second-largest employer, after oil, sustaining an estimated 3.5 million
people in the least developed parts of the country.
The new sugar authority also will issue production and export quotas to
the remaining 33 mills in Mexico that are in private hands, the statement
said.
The long-awaited program is intended to maintain a stable local supply
and keep exports orderly -- an issue that has long been a major problem.
Despite recent record crops, Mexico' s sugar industry has been plagued
by low prices, massive debt from the 1989-91 privatization of the mills
and competition from high-fructose corn syrup imported from the United
States.
In addition, Mexico has been involved in a four-year row with the
United States over its right under the North American Free Trade Agreement
to export all of its surplus sugar production duty-free to the United
States.
The new sugar authority will oversee all exports and seek the maximum
duty-free export quotas to the United States.
It will also offer mill owners credit through the government' s export
development bank, Bancomext, allowing mills to pay cane growers. A 1960s
presidential decree guarantees Mexican cane growers payment upfront for
about two-thirds of their cane at delivery, which mills have struggled to
pay.
The new plan also requires growers to be paid on the basis of sucrose
levels instead of tonnage. |