16 March, 2007

Sugar Transhipment

Guest Editorial: Sugar Transhipment.

As everyone in Anguilla knows, we are now a major player in the sugar trade. Anguilla, which has not had a cane field for over one hundred years, is exporting sugar to Europe. The idiocy of it all is so stunning that we have sat looking on in utter amazement. The following story was sent to me by a guest editor. I could not refrain from publishing it:

On page 3 of the 9 March "Light Newspaper" there is a story about transhipment.

Any article which attempts to discuss aluminium and sugar transhipment as a common "device" is going to contain errors. There are several basic and important differences.

We do not know why the sugar volume is down. It is important to recall that the trade is seasonal. Also, Anguilla has a small quota that we can't exceed.

There is no duty on products which originate in the OTs and are shipped to the EU. The reason sugar needs to be processed is to qualify it as an Anguillian product. The rules are well defined; it is not enough to simply re-package the sugar.

Aluminium (and motor vehicles) falls under completely different transhipment rules. These commodities are limited to manufactured products, and exclude sugar, rice and agricultural products. Aluminium is manufactured from bauxite; unprocessed raw materials such as bauxite and other ores are excluded, since they are not "manufactured."

The EU duty on aluminium is 6%. When transhipped through an OT, duty must be paid in the OT at a rate no less than that normally payable in the EU. George must be mistaken about Anguilla offering a cut rate on duty.

Anguilla has never transhipped rice. Montserrat did, before their facility was destroyed by the volcano. It has not been thought profitable to replace the factory, or to engage in similar activity in Anguilla.

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