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Parliament backs accord aimed at ending 16-year banana war

Plenary Session Press release - External/international trade03-02-2011 - 12:20

The 2009 Geneva agreement on trade tariffs for bananas from Latin American countries, which is designed to end the longest-running dispute in the history of international trade, received the backing of the European Parliament on Thursday. MEPs warn, however, that this deal cannot reconcile the interests of all parties, including those of EU banana producers.

MEPs do not believe the special financial provisions for the EU's outermost banana-producing regions give sufficient support to EU producers in La Réunion, Guadeloupe, Martinique, Guyane, Azores, Madeira and the Canary Islands, who could be significantly affected by the agreement. 

They therefore call on the Commission to increase support for EU and ACP banana growers and extend it to 2020 if necessary. They also urge the relevant EU authorities to take other steps to ensure that domestic EU producers are able to stay in the market.

The Geneva agreement

The EU has agreed to gradually end its preferential treatment of banana exporters in African, Caribbean and Pacific (ACP) countries in exchange for an agreement by Latin American countries to drop their complaints at the WTO.

As for the main ACP banana-producing countries, in addition to regular EU aid, they are to receive extra help from the EU budget (up to €200 million) to compensate for the EU’s improving trade relations with Latin America. The EU's gradual reduction in its import tariff on bananas from Latin America, from €176 a tonne at the outset to €114 in 2017 will make Latin American bananas more competitive on the EU market.

However, the support for ACP countries could prove insufficient in terms of resources and too short in terms of its implementing period to provide effective help to local banana producers, warn MEPs who also firmly reject any attempt to finance this support by money earmarked for development cooperation. The therefore ask the Commission to indicate clearly that it would be financed by fresh money from additional resources and to present a new multiannual financing arrangement.

The EU is the world's largest banana market. More then 70% of bananas sold in the EU come from Latin America (mainly Ecuador, Colombia, Costa Rica and Panama), around 20% come from ACP States (chiefly Cameroon, Côte d'Ivoire, Dominican Republic, Belize and Surinam) while the rest are grown in the EU itself (Cyprus, Greece, Madeira, Canary Islands and French overseas departments of Guadeloupe and Martinique).

REF. : 20110203IPR13101