São Paulo - The World Trade Organization's Arbitration Committee has ruled in favor of Brazil in the dispute on European Union sugar subsidies.

According to minister of Agriculture, Roberto Rodrigues, the ruling is in favor of free trade and signals the possibility of progress in the negotiations between Mercosur and the EU, which are scheduled to reconvene on Monday in Brasilia.

Rodrigues explained that the subsidies allowed the EU to place some two million tons of sugar made from sugarcane on international markets at prices lower than Brazilian prices, effectively driving out the Brazilian product. With the WTO ruling, Brazil should raise its sugar exports by some one million tons, he declared.

Agência Brasil
Reporter: Marli Moreira
Translator: Allen Bennett
08/06/2004