Brazil has announced that it has suspended a call for a panel to review its WTO dispute over claims of sugar subsidies with Thailand and is looking to collaborate with Thailand to develop the sugar industry. According to an industrial news source, Mr. Uttama Saowanayon, the Minister of Industry, and Ms. Warawan Chitaroon, Secretary General of the Office of the Cane and Sugar Board, have been in contact the Department of Trade Negotiations and been informed informally that Brazil has halted its request for a panel to review its dispute submitted to the World Trade Organization (WTO) over the allegation that Thailand’s sugar subsidy program has affected the global sugar industry. The suspension was reported to come into effect as of March 30, 2018.
The move came after Thailand had taken steps to restructure its cane and sugar industry by floating sugar prices, abolishing sugar quotas, and designating reserve stocks only sufficient for domestic consumption.
In view of Thailand’s earnest commitment to solving the issue and complying with WTO regulations, Brazil has suspended its petition to assemble a panel and will wait until Thailand has completed restructuring its cane and sugar industry and amended its Cane and Sugar Act. This is also in part thanks to the cooperation between the Ministry of Commerce, the Ministry of Industry, the Ministry of Agriculture and Cooperatives, and the Ministry of Foreign Affairs, as well as sugarcane growers and sugar mills, who have consistently come together to tackle the problem and negotiate with Brazil.
The amendments to the Cane and Sugar Act, which cover a range of issues including the utilization of cane in bioindustry to increase value for the cane industry, the discontinuation of governmental subsidies, and the abolishment of price compensation if the initial price is higher than the final counterpart, are being submitted to the Cabinet. The draft Act will then be proposed to the National Legislative Assembly for review. The entire process is expected to take about six months.
Brazil has requested a meeting with Thailand to update progress on its sugar system restructuring and the amendments to the Cane and Sugar Act and other related laws. In addition, Brazil has expressed its willingness to cooperate with Thailand to formulate plans for the development of the country’s economy, production technology, human resources in the cane and sugar industry, and bioindustry.