I refer to the contribution of M.R. entitled “Sugar: Fair share” in your issue of Friday 6 April 2007.
I will cite the following extracts.
“It is being said that the large owners, grouped under the Mauritius Sugar Producers Association (MSPA), are expecting that 75% of the EU funds should be made available to them exclusively for carrying out the reforms as set out in the blueprint for the sector.
The MSPA (as well as the private sector grouped under the JEC) have expressed the view that the entire reform process risks being blocked unless it was clearly stated that 75% of the EU resources would be allocated to the MSPA members for modernisation purposes under the blueprint and 70% for the implementation of the VRS.”
The Mauritius Chamber of Agriculture would like to draw attention to the fact that the above information relating to the share of Accompanying Measures from the EU to be devoted exclusively to the sugar industry is incorrect. It therefore wishes to recall the following.
Ø The amount of Accompanying Measures being expected from the EU is of Euros 248 million and the overall amount of EU support is of the order of Euros 301 million all in the form of grants (extract from Cabinet Decisions of 2 March 2007).
Ø Of these Euros 301 million, the industry has been given to understand that only a 46% share will be directed towards the reform project. The rest, i.e. some 54%, will be devoted to the other sectors of the economy through the national budget.
Ø In his reply to Parliamentary Question B/1524 on 28 November 2006, the Honourable Minister of Agro Industry and Fisheries mentioned the following: “The re-engineering of the sugar industry will entail a significant social cost. The request for funding under accompanying measures includes a proposal to meet part of the VRS and Blue Print costs from the funds provided by the European Union (i.e. 75% of the total VRS costs and 70% of the total Blue Print costs) (as reproduced from the official transcript). I understand there was an involuntary inversion of figures as the Honourable Minister meant to say “75% of the total Blue Print costs and 70% of the total VRS costs”.
Ø The total cost of projects to be undertaken in the context of the industry reform is estimated at Euros 675 million, and the social costs component, that is, Blue Print costs and VRS costs, is evaluated at Euros 132 million (Multi Annual Adaptation Strategy 2006-2015). 75% of the total Blue Print costs and 70% of the total VRS costs actually consolidate to Euros 94 million. The remaining Euros 38 million are being provided by the industry.
Ø Therefore, the proportion of EU funds that would be devoted to social costs should be of the order of 31% (94 million out of 301 million).
I trust that the above clarification will assist in enabling your readers have a better grasp of the current situation regarding the Accompanying Measures coming from the EU.