Why unwinding preferences is not the same as liberalisation: the case of sugar

Abstract

Many of the changes to developed country trade policy that affect developing countries do not fit neatly into the category of ‘liberalisation’ yet they are frequently assessed as if they did. The recent changes to the EU’s regimes for production and imports of sugar fall into this group: both production and trade policies were highly distorted before the change and will remain so after it, but the distribution of the effects of these distortions will be altered. This will affect three of the six Development Cooperation Ireland programme countries in Africa: Mozambique, Tanzania and Zambia. Returns from sugar exports to the EU will be less than otherwise would have been. How much lower depends critically on how the sugar market develops after 2009.Sugar, liberalisation, value chains