Brendan Smith (Cavan-Monaghan, Fianna Fail)

I thank Deputy Wall for raising this issue. I am aware of the concerns that were expressed following the closure of Carlow sugar factory in March about transport arrangements for the delivery of sugar beet to Mallow. The transport issue is one to be resolved between Irish Sugar Limited and the beet growers and I have no function that regard. I understand the two parties have been working constructively on this and other issues and I am satisfied they can devise satisfactory arrangements to deal with the new situation. The company has already announced plans for a new rail depot to assist beet growers to make their deliveries.

The European Commission recently signalled its intention to publish the formal legislative proposals for reform of the European Union sugar regime on 22 June. The Commission's initial ideas for reform as outlined in its communication of last July would, if adopted, have serious consequences for sugar beet growing and processing in this country and the Minister has made it abundantly clear in discussions in the Council of Ministers that proposals on those lines are unacceptable. Ireland is not alone in this regard. We are in a group of ten member states with shared concerns about the Commission's initial proposals and we made a joint ministerial submission to the Commission in this regard.

In our view, the aim should be to maintain the existing distribution of sugar beet and sugar production in the entire EU territory. We believe that reform should be based on the following principles: an import system from third countries which will ensure predictable and regular import quantities and it is important to remember that the poorest sugar-producing countries want an arrangement like this rather than the race to the bottom in price terms that totally free access would bring; the price reduction should be significantly less than that proposed and should be implemented more gradually; the impact of the quota reductions should fall mainly on "C" production; and transfers of quotas among member states should not be allowed.

It is generally acknowledged that reform of the sugar regime is now unavoidable for a number of reasons, in particular the developments at World Trade Organisation level and other international pressures. The recent ruling by the WTO appellate body will certainly add to the pressure for reform and there have been suggestions that when the reform proposals emerge, they may be even more severe than originally anticipated. Therefore, we do not underestimate the scale of the challenge facing us when the reform proposals come before the Council of Ministers in the autumn. Ireland's primary objective in the forthcoming negotiations will be to ensure that the future shape of the European Union sugar regime is consistent with the continuation of an efficient sugar beet growing and processing industry in this country.

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