European Parliament backs agreement aimed at ending banana war

[News_Editor]

European Parliament backs agreement aimed at ending banana war

2011-02-04 06:39:11 GMT+7 (ICT)

BRUSSELS (BNO NEWS) -- The European Parliament on Thursday backed an agreement aimed at ending the 16-year banana war, the longest-running dispute in the history of international trade.

Members of the European parliament (MEPs) supported the 2009 Geneva agreement on trade tariffs for bananas from Latin American countries but warned that this deal cannot reconcile the interests of all parties (including EU producers).

The agreement could significantly affect to EU producers in La Réunion, Guadeloupe, Martinique, Guyane, Azores, Madeira and the Canary Islands, despite the special financial provisions for the EU's outermost banana-producing regions.

Therefore, MEPs called on the European Commission to increase support for EU and African, Caribbean and Pacific (ACP) banana producers and extend it to 2020 if necessary.

Despite supporting the 2009 Geneva agreement, the European Parliament considers that further steps are needed to ensure that domestic EU producers are able to stay in the market.

In 2009, the EU agreed to gradually end its preferential treatment of banana exporters in ACP countries in exchange for an agreement by Latin American countries to drop their complaints at the World Trade Organization (WTO).

In addition to the regular EU aid, the main ACP banana-producing countries are to receive extra help from the EU budget up to €200 million ($272 million) to compensate for the EU’s improving trade relations with Latin America.

It is expected that by 2017, the EU's gradual reduction in its import tariff on bananas from Latin America will make them more competitive on the EU market. However, the support to ACP countries may be insufficient to effectively help banana producers.

MEPs urged the Commission to finance the aid with fresh money from additional resources and to present a new multiannual financing arrangement. They also rejected financing this support with money earmarked for development cooperation.

The EU is the world's largest banana market. More then 70 percent of bananas sold in the EU come from Latin America, mainly from Ecuador, Colombia, Costa Rica and Panama. Around 20 percent come from ACP countries while the rest are grown in the EU itself.

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