Ten EU countries, including Ireland, have joined forces to reject plans to overhaul sugar policy, a subsidy-heavy system criticised for distorting world trade, saying they fear huge job losses and the collapse of national industries.

A group of Mediterranean countries led by Italy and Spain and backed by four new member-states attacked the proposals, which recommend slashing internal prices by 40 per cent, scrapping the safety-net intervention system and cutting output. The Republic of Ireland and Finland also signed the letter

While Third World countries and free trade campaigners say the plans do not go far enough to prise open a highly protected market, some of Europe's lesser producers say the result would be a flood of imports and the death of national sugar industries.

"This [ proposal by the EU executive Commission] ... would have a devastating effect on farms and industrial enterprises working in the sector and would result ... in concentrating sugar beet and sugar production in few member states," read the declaration, obtained by Reuters.

The other signatories to the letter were Greece, Hungary, Latvia, Lithuania, Slovenia and Portugal.

One of their main complaints is the plan to allow national production quotas to be transferred across borders.

France, with the EU's largest sugar output and whose farmers receive by far the lion's share of EU farm subsidies, was not a signatory. - (Reuters)