The decision means the import tolls on Brazilian ethanol will remain at the lower 6.5 percent rate for “chemical products” instead of the 38 percent would have accompanied a re-classification as an “agricultural product”.
“We are happy. This was a prerequisite for us to able to continue our investment in ethanol and research in second generation biofuels,” said trade minster Ewa Björling on Friday.
The decision applies across the European Union but is of particular importance to Sweden as the country has an unusually high number of ethanol-fuelled cars – 150,000.
The Swedish government has underlined for its European colleagues that there is a significant risk that consumers return to using petroleum products if the price rises.
The issue was considered already last year. Sweden was able to push through its argument, and has now repeated its success. But the decision is valid for only one year and will then be reviewed.
“It could then be a hard fight,” Ewa Björling.