SRI LANKAN GOVERNMENT TO STOP IMPORTING SUGAR
The Food Department will no longer
import sugar from April 1, senior officials of the Food and
Cooperatives Ministry and the Department told Reuters.
    They said the decision was taken after the Sugar Importers
Association asked that the sugar trade be further liberalised.
    "The Food Department will cease trading in sugar and will no
longer hold a buffer stock," a senior official said.
    He said the government has finalised an agreement with
E.D.F.Man (Sugar) Ltd under which E.D.F.Man will hold a buffer
stock on the government's behalf of 20,000 tonnes, against the
45,000 tonne buffer stock usually held by the Department.
    Officials said the size of the buffer stock has been
reduced because the private sector will hold its own stocks.
    The agreement with E.D.F. Man includes details such as
trigger pricing mechanisms, they said.
    Four months ago the Department allowed the private sector
to import sugar without government clearance. The Department
and the private sector each imported around 115,000 tonnes of
sugar last year, when national consumption was 280,000 tonnes.
    An Importers Association official said that "even if the
Department no longer imports sugar, we would not necessarily
buy more."
    This is because the Association would still have to compete
with the Cooperatives Wholesale Establishment (CWE), he said.
    The CWE is a semi-government body and the official said
arrangements are being made for state cooperatives and holders
of food subsidy stamps to draw their sugar from it, starting
April 1.
    Ministry officials said the CWE can either import sugar or
buy it from a local bonded warehousing scheme run by E.D.F. For
the past two years.
 REUTER
