BRAZIL: Cocaine growers sniff at coffee import sweetner

By Keith Nuthall | 27 October 2000

The legality of trade schemes that give import sweeteners to countries where illicit drugs are produced, in a bid to wean their farmers onto legal crops, is being challenged by Brazil, which claims that they have unfairly damaged the ability of their coffee exporters to sell into the European market.Disputes proceedings at the World Trade Organisation (WTO) have been launched by the Brazilians, who object to special concessions that are offered to rival coffee producers in Columbia, Peru, Bolivia and Central America by the European Union.These are administered under the so-called "drugs regime" which in the case of instant "soluble" coffee, currently allows duty free access of exports from these narcotic producing countries into the EU market.Requesting formal consultations with the European Commission - the first stage of a WTO disputes procedure - a Brazilian government statement said: "The above-mentioned measures, both separately and jointly, adversely affect the importation into the EU of soluble coffee originating in Brazil."It claimed that the trade concessions are "inconsistent" with GATT, the General Agreement on Tariffs and Trade. The Commission is expected to justify the special treatment under GATT clauses that allow governments some leeway to introduce trade restrictions because of non-trade concerns. If the EU and Brazil fail to resolve the issue in consultations, a disputes panel will have to rule on whether this extends to anti-drug policies.

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The legality of trade schemes that give import sweeteners to countries where illicit drugs are produced, in a bid to wean their farmers onto legal crops, is being challenged by Brazil, which claims that they have unfairly damaged the ability of their coffee exporters to sell into the European market.Disputes proceedings at the World Trade Organisation (WTO) have been launched by the Brazilians, who object to special concessions that are offered to rival coffee producers in Columbia, Peru, Bolivia and Central America by the European Union.These are administered under the so-called "drugs regime" which in the case of instant "soluble" coffee, currently allows duty free access of exports from these narcotic producing countries into the EU market.Requesting formal consultations with the European Commission - the first stage of a WTO disputes procedure - a Brazilian government statement said: "The above-mentioned measures, both separately and jointly, adversely affect the importation into the EU of soluble coffee originating in Brazil."It claimed that the trade concessions are "inconsistent" with GATT, the General Agreement on Tariffs and Trade. The Commission is expected to justify the special treatment under GATT clauses that allow governments some leeway to introduce trade restrictions because of non-trade concerns. If the EU and Brazil fail to resolve the issue in consultations, a disputes panel will have to rule on whether this extends to anti-drug policies.

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