Local view for "http://purl.org/linkedpolitics/eu/plenary/2012-09-11-Speech-2-748-000"
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"en.20120911.43.2-748-000"2
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"Mr President, I will try to answer parliamentary questions on behalf of my colleague, Mr Cioloş.
Ladies and gentlemen, the European refining sector entered the market economy as a result of the 2005 reform, after a transition period that ended in 2009. This market-oriented approach was what was wanted and there is no turning back for us now.
The Commission’s job is to balance the EU sugar market. Sugar imports have risen dramatically since 2006. They reached a historical high of 4 million tonnes in 2011. Imports from ACP countries have also followed this trend. If ACP countries decide to export to the EU sugar refined by them, not only must we accept it; we must also acknowledge that it contributes to the development of their economies. The difficulties reported by a small number of refining companies have nothing to do with a shortage of sugar. They are to do with greater competition between European refiners, with a sharp increase in the production capacity of refiners. This explains why some plants are not operating at full capacity.
The main objective of the sugar reform was to increase competitiveness, on a sustainable basis, and the market-oriented approach of the EU sugar industry. The EU has become a net importer of sugar, whereas before it was a key net exporter. This reform has therefore been successful as it has done away with structural surplus production of sugar.
The current sugar market regime is valid until 30 September 2015. In October 2011, the Commission presented its proposal for the future functioning of the sugar regime in the European Union, which provides for the abolition of production quotas. This is currently under discussion with the European Parliament and other European institutions.
On behalf of Mr Cioloş, I would urge you to take an active part in this debate on the CAP post-2013 and the future of the quota system.
You will be aware that the reform of the common market organisation for sugar (CMO) dates back to November 2005, and that the aim of this reform was to increase the competitiveness of the EU sugar sector. The sugar beet sector suffered with the closure of many factories while, at the same time, the refined cane sugar sector was given a budget of EUR 150 million to enable it to become more competitive. This reform also abolished the difference between traditional refiners and sugar refiners, with a transitional period of three years ending in 2009. Meanwhile, the European Union granted duty-free access to African, Caribbean and Pacific (ACP) and ‘Everything but Arms’ (EBA) countries, but with a safeguard clause set to be triggered when imports exceeded 3.5 million tonnes, which includes 1.6 million tonnes for ACP countries which were not least developed countries (LDC). In 2005, a World Trade Organisation (WTO) panel restricted exports to 1.35 million tonnes.
Following the sugar reform, the sugar quota fell to the level of 13.3 million tonnes compared to a sugar quota of 17.4 million tonnes in 2004-2005. As a result, 41% of factories were closed. Meanwhile, refining capacities increased by more than 1.5 million tonnes in the European Union of 27 and so-called ‘traditional’ refiners decided to increase their capacity to 1.15 million tonnes over the past five years.
Current imports are based on preferential agreements with the ACP countries and the least developed countries to the tune of 1.8 million tonnes this year, which, with 670 000 tonnes from Brazil, 380 000 tonnes from the Balkans and 400 000 tonnes from reduced-rate auctions, give a total of 3.2 million tonnes for the current year. For the next year, quotas of nearly 300 000 tonnes have been allocated to Central and South America and 400 000 tonnes of sugar are imported annually in the form of processed products.
2009-2010 was not a typical year. World prices were higher than prices in the European Union, which had not been seen for 50 years. ACP countries therefore preferred to sell their domestic goods on the world market or on the domestic market, and they did not deliver the quantities specified for the European Union. Market balance in the EU was under threat for our consumers. The 2005 reform clearly states that it is only in this instance that the Commission is allowed to take action. To balance the market, the Commission has authorised imports during 2010-2011 and 2011-2012 under preferential conditions and at discounts on the EU quota-free sugar market. This action is balanced, both in terms of volume and conditions. In total, 2.35 million tonnes of extra sugar were placed on the EU market, 1.25 million tonnes of which were imports.
It is true that some refiners are complaining about not enough sugar being available, and some of you are also raising this issue. What is it about then?
The first thing to point out is that this view is not universally shared by European refiners.
The second thing is: what do the import figures tell us? Before the 2005 reform, imports stood at 2.3 million tonnes. Since the reform, they have risen. To say then that there is less imported sugar and that this is why some companies are having problems bears no relation to reality.
What is the real problem, then? A more detailed analysis of the situation for each Member State and for each refining company shows that the refining industry in Europe has entered the market economy and has been opened to competition, as was intended by the 2005 reform. Competition between refiners is now a reality. Some Member States and some refiners have increased their refining capacity by securing their supplies from third countries. For other refiners, we see that supply volumes have dropped off since the reform, while total European imports have grown. It is therefore simply a problem of private enterprise business strategy."@en1
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