EU inks banana trade deal at WTO

Posted by AFN Staff Writers on 16th December 2009

The banana trade dispute between the EU, parts of Latin America and US fruit companies has officially come to an end this afternoon (15 December) after a final agreement was published in Geneva.

Disputes proceedings have been staged at the WTO on EU banana import protection since 1996, almost as long as the trade body has existed.

Latin exporters and US-based fruit companies have been fighting the preferential access to EU markets given to bananas from the Caribbean, Africa and the Pacific, which enter as duty-free.

That particular special treatment will continue, with the Latin American countries agreeing not to demand further cuts from the EU within the WTO’s Doha Development Round.

However, the EU will immediately cut import duties on Central and South American bananas from EUR176 a tonne to EUR148 a tonne. The duty will be further reduced to EUR114 a tonne over the next seven years.

Welcoming the deal, WTO director general Pascal Lamy said: “This has been one of the most technically complex, politically sensitive and commercially meaningful legal disputes ever brought to the WTO.”

The deal also saw a side agreement about the Doha talks. All parties agreed tariff cuts for “tropical products” would be cut more deeply in a global agreement than so far accepted.

They also agreed duty reductions for food exports from African, Caribbean and Pacific (ACP) countries would be phased out over a longer period of time than previously discussed under Doha.

ACP exports are set to face growing competition and the European Commission has promised to spend an additional EUR200m to help the main banana exporting countries adapt to the new regime.

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