{"id":50029612,"date":"2019-08-15T10:45:24","date_gmt":"2019-08-15T09:45:24","guid":{"rendered":"https:\/\/stage.dialogochino.net\/?p=29612"},"modified":"2023-03-12T16:29:06","modified_gmt":"2023-03-12T16:29:06","slug":"29612-el-salvadors-sugar-producers-want-to-keep-taiwan-free-trade-pact","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/business\/29612-el-salvadors-sugar-producers-want-to-keep-taiwan-free-trade-pact\/","title":{"rendered":"El Salvador\u2019s sugar producers want to keep Taiwan free trade pact"},"content":{"rendered":"

In August 2018,<\/span> El<\/span> Salvador<\/span> followed the Dominican Republic<\/a> and Panama<\/a> in switching diplomatic allegiance from Taiwan to China. But in March 2019, Nayib Bukele, then president-elect, <\/span>cast doubt<\/span><\/a> over whether his government would maintain that status.\u00a0<\/span><\/p>\n

\u201cChina does not play by the rules; they do not respect the rules,\u201d he said.<\/span><\/p>\n

The Chinese embassy in El Salvador responded with a <\/span>statement<\/span><\/a> affirming that economic cooperation between China and El Salvador would not be a \u201cdebt trap\u201d but instead \u201ca sweet deal for both nations.\u201d<\/span><\/p>\n

Since then, commercial relations, which centre heavily on El Salvador\u2019s export of sugar, have evolved rapidly. After <\/span>taking office in June<\/span><\/a>, Bukele <\/span>admitted <\/span><\/a>he had to \u201crecognise China\u2019s status in the world\u201d and cement ties. El Salvador sent<\/span> US<\/span>$83.2 million<\/span><\/a> of products to China last year, up 82%<\/span> on the previous year, making it the sixth biggest destination for El Salvadorian exports.\u00a0<\/span><\/p>\n

\n

95%<\/p>\n

\n
\nsugar's share of El Salvador's total exports to China
\n\n <\/div>\n <\/div>\n

Sugar makes up 94.6% of exports to China, according to the <\/span>Central Reserve Bank<\/span><\/a> (BCR). While this is cause for optimism in some quarters, small farmers and other observers are conscious of the consequences of expanding agribusiness in the <\/span>second <\/span><\/a>most<\/span> <\/a>deforested country in Latin America.<\/span><\/p>\n

Sugar union<\/h2>\n

The <\/span>Sugar Association<\/span><\/a> (AAES), the union in charge of production in El Salvador, expressed concerns about <\/span>cancelling a free trade agreement<\/span><\/a> with Taiwan, which was set to take place in March 15 of this year. In February, it <\/span>sued<\/span><\/a> the ministry of foreign affairs.<\/span><\/p>\n

\u201cAs the productive sector we feel highly affected by this because we will suffer substantial economic losses,\u201d <\/span>said<\/span><\/a> Mario Salaverr\u00eda, the union\u2019s president. \u201cWe were not consulted in this process at all and neither was Taiwan.\u201d The AAES had already signed deals to export 80,000 tonnes of sugar.<\/span><\/p>\n

The union is also concerned about the high tariffs China has imposed on sugar. The country imports <\/span>1.94 million tonnes<\/span><\/a> a year, making it one of the largest global buyers.\u00a0<\/span><\/p>\n

Since there is no regulation around agribusiness, companies can abuse resources here<\/span><\/p><\/blockquote>\n

But in 2016, <\/span>drought<\/span><\/a> hit the domestic sugar crop and small farmers (mainly from Yunnan province) suffered. In an effort to support them, last year China began restricting imports by placing high tariffs on its main suppliers, mainly Brazil and Thailand.<\/span><\/p>\n

Resenting the impact on their economy, Brazil <\/span>complained<\/span><\/a> to the World Trade Organisation.<\/span><\/p>\n

Looking to placate El Salvadoran producers, China then made a goodwill <\/span>statement<\/span><\/a> in March this year: \u201cChinese businesses are motivated to buy sugar and other products from El Salvador \u2026 the tariffs will be paid by the sugar importers rather than exporters. The producers from El Salvador can feel at ease with this aspect,\u201d the Chinese Embassy in San Salvador <\/span>tweeted<\/span><\/a>.\u00a0<\/span><\/p>\n

\u201cChina has talked about wanting to buy our sugar, but for us the free trade agreement with Taiwan is non-negotiable,\u201d argued Salaverr\u00eda. \u201cSure, we have already been selling to China, but at what we call \u2018world market rates\u2019, with tariffs of 85%. With Taiwan we paid zero tariffs,\u201d he said.<\/span><\/p>\n

Salaverr\u00eda explained that the AAES\u2019 mission is not to break relations with China but rather, to maintain a commercial relationship with Taiwan and a diplomatic one with China.<\/span><\/p>\n

He said the union had already met with government officials who privately agreed to maintain the FTA with Taiwan. The Salvadoran High Court halted the cancellation of the FTA, but there hasn\u2019t been an official statement on its continuation.\u00a0\u00a0<\/span><\/p>\n

The environmental cost of sugar production<\/h2>\n

High-demand and economic need in El Salvador have led to the expansion of industrial agriculture, mostly sugar and coffee, fuelling soil degradation and deforestation. Sugar cane fields use a lot of pesticides, which harm soil and water sources.<\/span><\/p>\n

Whoever has the technology to exploit water does it without any consequence in El Salvador<\/span><\/p><\/blockquote>\n

\u201cEnvironmental problems aren\u2019t commonly talked about in El Salvador,\u201d Gabriel Labrador, a researcher from investigative news platform El Faro explained. \u201cSince there is no regulation around agribusiness, companies can abuse resources here.\u201d<\/span><\/p>\n

El Salvador has the second largest surface area of cane sugar plantations in Central America and only to Haiti has lost a larger share of its forested land area. More than half the land is unsuitable for cultivation and erosion is rampant.\u00a0<\/span><\/p>\n

These problems combine to make people vulnerable to natural disasters and drought. Water sources are also highly contaminated.<\/span><\/p>\n

\u201cWhoever has the technology to exploit water does it without any consequence in El Salvador,\u201d Labrador added. \u201cCane sugar is the industry that consumes the most water. There is a serious environmental impact due to the amount of water used and there is no state policy.\u201d<\/span><\/p>\n

In 2016, over 250,000 gallons of molasses from a sugar cane factory <\/span>spilt<\/span><\/a> into the Magdalena river, affecting 400 families and killing thousands of fish, crustaceans, molluscs and amphibians.<\/span><\/p>\n

Labrador said: \u201cSince there is no policy and real enforcement in the sector, controlling the environmental impact depends on the goodwill of the companies – and as demand grows that is a dangerous thing.\u201d<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

In August 2018, El Salvador followed the Dominican Republic and Panama in switching diplomatic allegiance from Taiwan to China. But in March 2019, Nayib Bukele, then president-elect, cast doubt over whether his government would maintain that status.\u00a0 \u201cChina does not play by the rules; they do not respect the rules,\u201d he said. The Chinese embassy […]<\/p>\n","protected":false},"author":50000004,"featured_media":50029613,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[758],"tags":[531,50040317,600],"hashtags":[],"country":[20000110,50006305],"class_list":["post-50029612","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-deforestation","tag-farming","tag-trade","country-china","country-el-salvador"],"acf":[],"yoast_head":"\nEl Salvador\u2019s sugar producers want to keep Taiwan free trade pact | Dialogue Earth<\/title>\n<meta name=\"description\" content=\"Sugar farmers from El Salvador oppose trade tariffs that follow China switch but expansion could bring deforestation and soil erosion\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/dialogue.earth\/en\/business\/29612-el-salvadors-sugar-producers-want-to-keep-taiwan-free-trade-pact\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"El Salvador\u2019s sugar producers want to keep Taiwan free trade pact\" \/>\n<meta property=\"og:description\" content=\"In August 2018, El Salvador followed the Dominican Republic and Panama in switching diplomatic allegiance from Taiwan to China. 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