On April 26, Brazil will reactivate again on the agenda of the World Trade Organization, the complaint against Costa Rica for the imposition of a safeguard to increase the tariff on sugar.
After the Costa Rican authorities raised the tariff on imported sugar from 45% to 73%, the South American country decided to raise before the World Trade Organization, a process to exercise the right of suspension.
In June of this year, the Alvarado administration decided to increase to 79% and for the term of three years, the tariff on sugar entering the country. This increase was based on the argument that the unusual growth of imports was harming local production.
Arguing that the unusual growth in sugar imports is harming local production, the Alvarado administration decided to raise the tariff on products entering Costa Rica from 45% to 73% for a three-year period.
The Ministry of Economy, Industry and Commerce (MEIC) concluded the investigation requested by the Agricultural Industrial League of Sugar Cane (LAICA) and 4 mills, on the safeguard measure against imports of solid state, granulated sugar, known as white sugar, used for domestic and industrial consumption, justifying a deterioration in the main economic indicators of the National Production Branch (RPN), details an official statement dated June 15.
In Costa Rica, sugar producers are asking the government to raise tariffs or entry taxes on imports, and importers are opposing, as this would raise the final price to the consumer.
In July 2019, the Sugar Cane Industrial Agricultural League (LAICA) asked the Ministry of Economy, Industry and Commerce (MEIC) to launch an investigation with the aim of imposing additional tariffs on imported sugar, arguing that purchases from abroad would damage local production.
Costa Rican businessmen complain that because of export subsidies granted to sugar producers in India, there has been an artificial increase in production, causing prices to fall below costs.
Édgar Herrera, executive director of the Industrial Agricultural League of Sugarcane (Laica), explained to Elobservador.cr that "...
Arguing that local production must be protected, Costa Rican sugar manufacturers demand that, in addition to the 45% common levy already charged on imported sugar, an additional tariff must be imposed.
With a lawsuit against the Ministry of Foreign Trade in Costa Rica the virtually monopolistic Liga Agrícola Industrial de la Caña de Azúcar is attempting to limit the quotas for historical importers of the grain.
The administrative proceedings presented by Liga Agrícola Industrial de la Caña de Azúcar (LAICA) against the Ministry of Foreign Trade (COMEX), aim to limit the quotas for historic imports of sugar, and could have consequences for other mass consumption products in the country.
Days after the Brazilian government noted that the additional duty of 6.82% violated the WTO anti-dumping agreement, the Solis administration has reduced it by half.
The Ministry of Economy partially upheld the appeal filed by the sugarimporter Maquila Lama and decreased the additional tariff to 3.67%, on top of the 46% already paid on sugar imported from Brazil.
A change of minister in Costa Rica will aid in increasing the cost of sugar via an import tariff hike, harming consumers and the food industry, and increasing protection for the powerful sugar lobby.
EDITORIAL
The decision taken by the new chief of the Ministry of Economy reflects a clear interest in meddling in a process that should be resolved at a technical and non-political level.The decision to declare whether or not dumping occured in a particular market and what measures should be taken in response, corresponds to the office of Trade Defense, and should be free from any possible political bias.
The Ministry of Economy has decided to impose a new tax of almost 7% on sugar imported from Brazil, in response to a lawsuit brought by the union of local producers.
With this new protectionist measure the government is trying to put an end to a conflict that arose in 2015 between the Agricultural Cane League (Laica) and the importer Maquila Lama, when this company denounced a proposal to amend the regulation on sugar fortification claiming it attempted to restrict trade of imported grain.
The Commission to Promote Competition in Costa Rica has launched an investigation against Liga Agrícola de la Caña after a complaint was made by Maquila Lama.
At the request of the Agricultural Cane League the government has extended until the end of November the investigation into alleged dumping against the sugar importer La Maquila Lama.
The as yet unresolved conflict could once again make its presence felt with the import of organic sugar on the part of the Agricultural Cane League and also the importer La Maquila Lama, who filed with the Commission to Promote Competition (COPROCOM) a complaint of alleged monopolistic practices.See: "Sugar War in Costa Rica".
Maquila Lama has denounced the Agricultural Industrial Cane League for "pressuring wholesale businesses to remove" the product that the importerdistributes.
In a statement the company Maquila Lama says that"... for several days notices have been received from stores that sell the Mr. Maximus brand of sugar, in which it was indicated that sales representatives from LAICA have come to offer better conditions such as providing credit and transportation of the product to their outlets, among other things, with the condition that they stop selling Mr. Maximo sugar on their premises. "
In Costa Rica the virtually monopolistic Industrial Sugar Cane Agricultural League is supporting a recent decree that protects blocking imports of sugar by forcing sugar fortification to be done it its place of origin.
EDITORIAL
A statement issued by the Industrial Sugarcane Agricultural League (LAICA) abounds in views on the relevance of sugar fortification -which nobody questions-, and on the supposed benefits that the company brings to the Costa Rican consumers, including " stable prices. "
The importing company Maquila Lama claims that proposal to reform the rules on sugar fortification is an attempt to restrict imports of the grain.
The company Maquila Lama is opposed to the decree which is aiming to amend a regulation on sugar fortification promoted by the Ministry of Health, arguing that besides being discriminatory, it could restrict imports of the product from Brazil and any other country of origin.
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