Thanks to preferential trade (the EU’s Everything But Arms program), both rich and poor farmers oppose the EU’s move to liberalize its sugar regime:

Change was demanded of the EU after the WTO ruled earlier this year that its existing 40-year-old guaranteed pricing system was illegal. The WTO’s judgement followed a formal complaint from Australia, Brazil and Thailand.

These three countries will now benefit from a reduction in subsidised European sugar on the global marketplace, along with other smaller, and poorer, sugar producing countries in the developing world.

However, not all sugar exporting nations are happy at the changes. Some 18 sugar producing former European colonies with special access to EU markets will also now be affected by the guaranteed price cut, such as Mauritius, Barbados and Fiji. These so-called ACP countries (African, Caribbean and Pacific) have warned that their sugar cane growers will be less able to cope with the changes than European farmers.

Oxfam has called the EU’s agreement a “betrayal”, claiming it does not go far enough in helping sugar farmers in developing industries, at the same time as offering insufficient compensation for affected ACP members. [BBC]

My favorite piece on this topic is “Agricultural Liberalization and the Developing Countries: Debunking the Fallacies” by Arvind Panagariya [pdf]. See pages 11-12 for his comments on sugar and the EBA.