Developing countries and market access: the bitter-sweet taste of the European Union's sugar policy in southern Africa

Abstract

The European Union's Common Agricultural Policy (CAP) has long been criticised for its price-distorting impact on world markets. Pressure to reform the CAP emanated previously from domestic European concerns over the costs, efficacy and efficiency of the policy and, internationally, from countries whose competitive advantage was undermined. More recently developing countries, NGOs, multilateral institutions and development agencies have orchestrated a campaign to liberalise European agriculture, in the expectation that developing countries will benefit from a shift in production away from high-cost European producers. But it would be naïve to think of liberalisation as bringing universal benefits to the developing world. Inevitably, under any system of regulation, market or intervention, there will be a complex pattern of winners and losers. This paper examines the impacts of Europe's sugar policy on southern Africa and finds, somewhat surprisingly, that the region stands to benefit more from a preservation of the status quo than from liberalisation.