South African sugar producers are seeking an interim duty-free export deal for sugar to the European Union (EU) as talks for a quota and tariff-free access into the bloc continue, an industry official said. The EU, South Africa's largest trading partner, unveiled a new trade regime last year that allowed the world's poorest countries quota and tariff-free access into the market.
South Africa, the continent's biggest economy, is not regarded as a least developed country and consequently does not benefit from the European Union regulation. Trix Trikam, executive director of the South African Sugar Association (SASA) said on Thursday the industry was still in talks with the South African government and the EU to conclude an economic partnership agreement that would allow producers to export sugar into the bloc.
"In the short-term, we believe that asking for a fixed amount of sugar at duty-free is the way to go. In the long-term we would like what everyone has got, no quota, no duty," Trikam told Reuters. "If we get the (EU trade deal) we can enhance the revenue. Generally, the price you can earn in the EU market is better than what you would earn on the world market." The EU has become the world's biggest sugar importer after the bloc reduced subsidies to its farmers.
A senior European Union official last month forecast an increase of more than 1 million tonnes in annual EU sugar imports by 2014/15. South Africa, one of the world's top 10 exporters of the sweetener, exports about 40 percent of its sugar and the industry's annual export earnings stands at 2.5 billion rand ($344.4 million).