Competition for Sustainability: The Sugar Case

Abstract

The world sugar industry is characterized by strong regulations and protection by the State. These regulations and special protection date back several decades, and can be observed on both sides of the Atlantic. In fact, this sector has often been flagged as being among the most subsidized and distorted of all agricultural markets. Calls by the state to intervene in these markets have been conditioned by various public policy goals, where goals such as promoting the sector or supporting small agricultural producers often converge.The sugar sector is a clear example where eliminating distortions to competition would have positive environmental impact. Costa Rica and other sugar-producing countries have the chance to boost competition and improve ethanol production, bolster a high added-value industry with growing global demand, and have an important positive impact on environmental sustainability.