Despite fierce lobbying in opposition to the measure, Chile's Senate passed a law 31 October increasing the sugar tariff from 31.5% to 90%. The tariff, which will be effective for ten years, was passed as a safeguard to domestic beet sugar production.

The law passed without any changes to the bill originally approved in the Chamber of Deputies, Chile's lower legislative house. Since the bill was proposed by Chile's executive branch, the approval of both houses was enough pass it into law.

Senators cast their votes in the presence of more than 100 Chilean beet sugar producers demonstrating in favor of the tariff increase. Supporters of the legislation argued that increasing sugar import import tariffs will protect local beet sugar production from competition from larger sugar producing countries like Brazil.

Opposition to the law says it favours a small group of producers at the cost of 25 years of liberalized economic policy. Others argued that the tariff will lead to an increase in the price of sugar to consumers, thus making a basic commodity costly for Chile's poor.

Finance Undersecretary insisted that the tariff will not necessarily lead to a price increase. She added that the government is committed to not passing additional safeguards on sugar.

By Eric P Martin, just-food.com correspondent