European nations have cancelled lucrative sugar subsidies for Fiji after the Pacific island's military government refused to hold post-coup elections this year and extended a crackdown on media and critics.
The European Commission said it had cancelled subsidies worth 24 million euros ($55.17 million) in the absence of any commitment to elections in 2009, as promised by military chief and interim Prime Minister Frank Bainimarama.
"I encourage the government of Fiji to fulfil its commitments to the EU so that we are able to reinstate sugar reform payments in the future," European Commissioner for Development and Humanitarian Aid Louis Michel said in a statement on Monday.
Fiji's economy is largely reliant on sugar and tourism, and both have been battered by the hard line adopted by the government, with foreign tourists increasingly staying away.
Sugar is an important source of grassroots income and foreign exchange, with around 31% of the country's population reliant on the industry for their livelihoods.
High prices paid by the EC to counter the fall in the price of sugar sold to the EU amid industry reform has helped keep Fiji's industry competitive.
