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SUVA. Fiji (Fiji Times, May 1) – Members of the National Farmers Union in Fiji have called on government to provide them with a five-year tax holiday to ensure the survival in the country’s sugar industry.

Union general secretary Mahendra Chaudhry said the 500 sugar farmers who attended the union's annual general meeting yesterday, called for the tax holiday following the ruling by the World Trade Organisation to quash an application by the European Union to subsidise sugar farmers above current world market prices.

The decision by WTO will directly affect the country's sugar industry, as preferential prices of $60 per tonne will drop to about $40 per tonne.

Mr Chaudhry said with the drop expected to come into effect by July next year, it was necessary farmers were provided with a tax holiday so they would be able to continue in the industry. Mr Chaudhry said if not provided with a tax holiday, a huge number of farmers would exit the industry because it would be unprofitable for them to continue cultivating sugar cane.

"Farmers need money to invest in their farms and with the drop in preferential prices, this will leave them at a loss unless the Government provides them with a tax holiday or provides a minimum guaranteed price for their crop," he said.

"This tax holiday is not something new as it was provided to farmers by the late Ratu Sir Kamisese Mara during his term as Prime Minister.

"It will help farmers cope with the price reduction and assist them in improving productivity so they will be able to remain in the sugar industry," he said.

Mr Chaudhry expressed disappointment towards the Australian sugar industry that spearheaded the complaint against EU preferential prices. He said the Australians, who were regarded as "friendly Pacific Island neighbours'', had initiated the move that could ultimately see the sugar industry die out in Fiji.

Mr Chaudhry said the Australians were well aware of the Fiji sugar industry situation and how heavily farmers relied on the EU preferential prices.

He said the only way farmers would be able to remain in the industry was if the Government provided them with a tax holiday that would assist them to cope with production costs and increasing fuel prices.

He said apart from a tax holiday, the farmers had called for subsidies on all agricultural products.

He said if farmers were provided with subsidies, it would help them continue with farming despite increasing production costs.

May 2, 2005

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