In early 2000, European farmers were guaranteed a price ( ) for their sugar
EU P significantly higher than the world price (In 2005, the guaranteed price for European farmers
were three times higher than the world price), and there were restrictions on foreign imports – backed up by prohibitive import tariffs (In 2005, the import tariff was 324%). The EU government purchased excess sugar supply at and sold it to the world market. The world
EU P sugar price dropped significantly from to due to the extra supply from EU (According to
W W: P P a report by the World Bank, world sugar price dropped by 17% due to EU’s sugar policy). 1) (10 points) Analyze the impact of the EU sugar policy on EU sugar farmers, consumers, and
general taxpayers with a graph. Clearly label the graph for full credits. 2) (5 points) Mozambique, one of the world’s poorest nations, was a sugar exporter in early
2000. Approximately 80% of its people live in rural areas, where agriculture is almost the
only source of employment. The sugar sector was Mozambique’s single largest source of
employment in early 2000. Analyze the impact of EU’s sugar policy on Mozambique’s sugar
farmers, consumers, and general taxpayers with a graph. Clearly label the graph for full
credits.
