The
aim of this national adaptation strategy is to minimize the adverse effects of
the EU sugar reforms on the Swaziland sugar industry and the national economy.
Given the importance of sugar to the Swaziland economy the effectiveness of
these measures will have a direct impact on limiting levels of poverty at both
household and national levels. The strategy has identified a number measures
that will assist the structural transformation of the sugar sector in the
longer term, whilst reducing costs at all levels in the short to medium term.
The strategy also supports the development of alternative economic activities
in those areas where sugar production become economically unviable.
Short
term priorities identified as being suitable for immediate EU and other donor
assistance in 2006, include the establishment of a Restructuring and
Diversification Management Unit to coordinate the implementation of the
strategy, the restructuring of smallholder farmer financing and the use of
grant finance to restructure existing smallholders debt, the maintenance of
health and education facilities for affected communities, and the development
of suitable models for the future provision of social services presently
financed by the industry.
The
Swaziland government must also ensure that current levels of duty free access
to the EU market are expanded and that regional markets for sugar are nurtured
to maintain or increase the regional demand for sugar.
In
the medium term priorities will focus on programmes aimed at reducing the cost
of smallholder sugar production and reducing marketing costs, together with
measures for the diversification into alternative crops and the promotion of
small and medium enterprises.
High
priority will be given in the short to medium term to ensure that Swaziland
implements the required measures to qualify for general budgetary support, to
compensate it for losses in Government revenue. An additional medium term
priority is the securing of the necessary grant funding to close the funding
gap for LUSIP.
In
the longer term, development programmes focusing on poverty reduction will be
developed and implemented, whilst the sugar industry continues with its
restructuring processes.
The
overall funding requirement for the national adaptation strategy is €349
million which will be financed from a combination of sources including
Government, the sugar industry and a number of donors. Whilst this is a large
amount of money, it will be required over a period of ten years.
This
strategy will assist Swaziland develop a more competitive sugar sector that
will also assist the development of poor communities by maintaining the
viability of smallholder farming programmes. The strategy is based on the
belief and commitment that the Swaziland sugar sector has a potential to grow
further if the required support is made available timely.