Confectioners applauded a proposal by the nation's top economic planning body to more than double the Taiwan's imported sugar quota next year, saying the move will help level the playing field for food producers.
"This is the good news we have been expecting for years. Finally, the price of sugar can gradually be guided by free market mechanisms," said Sunny Chen (
The plan is in accordance with trade deals agreed upon as part of Taiwan's WTO entry and the governments liberalization of a market formerly monopolized by the state-run Taiwan Sugar Corp (Taisugar,
On Tuesday, the Cabinet's Council for Economic Planning and Development (CEPD) made the proposal to increase next year's quota on imported, refined sugar from the current 120,000 tones to 300,000 tones.
The government plan calls for gradual market opening through 2004, when the cap is finally eliminated. In addition to the quota on imported sugar, Taiwan also levied a 17.5 percent tariff on the commodity, which, according to the proposal, will be cut to 10 percent in 2004.
The proposal will be sent next to the Ministry of Economic Affairs and the Ministry of Finance for further review and later to legislature for final approval.
"If everything proceeds on schedule, enactment will take effect early next year," said an official at the CEPD surnamed Chiu.
According to Sunny Chen, Taiwan consumes about 500,000 tones of sugar annually, of which Taisugar controls on average more than 80 percent.
The monopoly on prices has hampered the confection industry's development, he said.
"Compared to imported sugar -- priced as low as NT$10 per kilogram -- NT$15 per kilogram from Taisugar is quite unreasonable," Chen added.
As an increasing number of foreign-made snacks and beverages are imported, local players are keen to cut costs and improve their competitive edge.
"The change will likely cut our annual expenditures on sugar by nearly NT$100 million," said Jean-Yves Yao (姚力仁), a UNI-President Enterprises Corp (統一) spokesman.
The firm uses about 20,000 tonnes of sugar every year.
According to Chen, consumer's with a sweet tooth will also benefit from the plan.
"When we convert the sugar cost savings for each finished product, the difference averages to less than a dollar per unit," UNI-President's Yao explained.
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