EU and Latin America confirm deal to end 'banana war'

During the WTO meeting's in Geneva, the European Union announced that an agreement has been reached with Latin Americas countries over long-disputed import tariff on bananas. The deal marks the end of the oldest trade war in the WTO’s history.

AFP - The European Union confirmed Tuesday that it had clinched a deal with Latin American countries to end a long-running trade war over banana tariffs.

"Meeting at the WTO in Geneva, ambassadors from the EU and Latin American countries today agreed to end a 15-year dispute over EU banana imports," the European Commission said in a statement.

"In the deal, seen as a boost for the Doha Round of world trade talks, the EU will gradually cut its import tariff on bananas from Latin America from 176 euros per tonne to 114 euros (255 to 165 dollars)," the EU's executive arm said.

"In response, the US has agreed to settle its related dispute with the EU.

"The EU has also offered to mobilise up to 200 million euros for the main African and Caribbean banana-exporting countries to help them adjust to stiffer competition from Latin America," it said.

The dispute over banana trade is the longest-running in the WTO, brought about by the EU's import regime introduced in July 1993.

While bananas shipped from Latin American countries are subject to import taxes, those from mostly poor former European colonies in the ACP region enter the bloc tariff-free.

The United States does not export bananas to the European Union but three of the largest producers with plantations in Latin America are US-based multinationals -- Chiquita, Del Monte and Dole.

However, the banana dispute as a whole can only be fully resolved if the EU also secures an accord with partner African Caribbean and Pacific (ACP) countries partners on compensation to help them cope with the tariff changes.

The US support for the overall settlement must also be made official.

Date created : 2009-12-15