Sugar dispute: Formal signing of settlement document between Thai and Brazilian govts to take place during WTO meeting on Feb 27-29

Deputy Government Spokeswoman Kenika Ounjit stated that on Tuesday, the cabinet approved a document aimed at resolving the dispute regarding sugar under the World Trade Organization (WTO) between Thailand and Brazil, as proposed by the Commerce Ministry.

Over the years the Thai government has engaged in negotiations with Brazil, while making significant improvements to the country’s sugar and cane structure, along with continuous adjustments to relevant laws and regulations, particularly a reduction of subsidy measures. This led Brazil to recognise Thailand’s efforts, resulting in a settlement reached in December 2023

According to the news report by Bangkok Post, The Commerce Ministry of Thailand presented a settlement document, mutually acknowledged by the Thai and Brazilian governments, on the issue of sugar subsidies. The formal signing will take place during the WTO meeting set for Feb 27-29 this year.

Previously, Brazil initiated the process to address the dispute over Thailand’s sugar subsidies on April 4, 2016, stating that Thailand’s support for its sugar and sugar cane industry may not comply with WTO regulations, impacting Brazil, the world’s leading sugar exporter.

Subsequently, both countries engaged in negotiations from 2016 to 2023. Thailand, during this period, underwent structural adjustments to its sugarcane and sugar industry. These measures included abolishing the quota system in January 2018, without specifying export quotas, and aligning with market mechanisms. Additionally, Thailand annulled the domestic sugar price setting by amending Section 17 of the Sugar and Cane Act of 1984 and adjusted the state’s support funds to sugar mills when the final sugar cane price fell below the initial sugar cane price. Consequently, government funding support is no longer in place.


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