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Sugar: let's pull the plug « Previous | |Next »
April 30, 2004

I wasn't going to comment on the $444 million federal assistance package the Prime Minister John Howard announced yesterday to compensate the ailing sugar industry for being locked out of the free trade deal with the United States.
G. Niall
Apparently the industry wanted a package worth about $600 million. For not gaining access to the US market? It sounds more like a handout to me that has been given some window dressing.

True, the industry has been pounded by low global prices, a strong Australian dollar, fierce competition from Brazil, near insurmountable foreign trade walls and high freight costs. Yet the sugar industry has been propped up by governments for years, and it has done little to reform itself or stop polluting the Great Barrier Reef.

Time to pull the plug on the cane growers? Tim Colebatch argues otherwise:

"Yesterday the Government made the obvious choice, and the right one. The prime reason our sugar industry has become uncompetitive has been Brazil's currency plunge. It will become competitive again when Brazil's currency rebounds, and we all know how volatile foreign exchange markets are. Bunker down, restructure, investigate alternatives, and wait: this is sensible policy that deserves applause."

Not really. It is corporate welfare.

And where is the sustainability bit? Is that just window dressing too ? The Queensland cane farmers are not interested in sustainable agriculture. They never have been. If a sustainable agriculture is a policy objective, then where is the big pressure on the canegrowers to force them to clean up their fertilizer and pesticide runoff in order to protect the Great Barrier Reef? Should the canefarmers not be required to attend university to learn something about the way science works? To learn about the casual connections between the canegrower's agricultural pollution, river flow the outbreak of the Star of Thorns and the ongoing destruction of the Reef.

As Phil Dickie reports:

"Sugar's problem is that the crop has downstream effects out of all proportion to the land actually under cane. According to the CRC-Sugar study, in the Johnstone River, the roughly 10 percent of the catchment under cane is responsible for about 35 percent of the sediment, just over 30 percent of the phosphorus and nearly 50 percent of the nitrate load."

What the Howard Government has done is sideline the work of the reef research and administrative institutions; continue to mutter the mantra of scientific uncertainty while neglecting to invoke the precautionary principle; and do everything it can to reassure and protect the cane farmers and rural lobbies.

This is the use of agricultural subsidies just like in the EU, or the US under the Bush administration. And the Howard Government continues to say that they are good economic managers! They have turned their back on the free market and embraced old fashioned protectionism that encourages inefficient farmers to prosper on the basis of handouts. So much for Australia's Cairns Group credentials.

| Posted by Gary Sauer-Thompson at 3:53 PM | | Comments (0)