EU, Latin America proclaim end to `banana war' | world | Hindustan Times
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EU, Latin America proclaim end to `banana war'

The European Union and Latin American banana-producing countries have signed an agreement to put an end to the so-called "banana war" they have been pursuing for the past two decades.

world Updated: Dec 16, 2009 14:00 IST
EFE

The European Union and Latin American banana-producing countries have signed an agreement to put an end to the so-called "banana war" they have been pursuing for the past two decades.

The signatories of the pact Tuesday committed themselves to laying to rest all the disputes about bananas that have arisen among them in recent years and to not introducing any additional complaint during the long process of implementing the accord.

The agreement includes the immediate reduction of the tariff on Latin American bananas from 176 euros ($255) per tonne to 148 euros ($214), and after that there will be gradual cuts in that levy until it stands at 114 euros ($165) in approximately eight years.

"Today (Tuesday) is a good day. We've achieved a good agreement that protects the tariffs, that doesn't establish quotas and that is in consonance with the rules of the World Trade Organization," the EU's envoy to the WTO, Eckart Guth, told reporters in Geneva.

The ACP countries (former European colonies in Africa, the Caribbean and the Pacific, who up to now have been exempt from that customs duty) do not want their competitors to get any reductions.

In the end, the ACP nations accepted the agreement in exchange for compensation of "190 million euros ($275.86 million), expandable to 200 million euros ($290.37 million) subject to the vote of our legislators", a European source told EFE.

"The accord is good because it represents a good equilibrium for the Latin American countries who will more easily enter into the European market and because it allows the ACP countries to continue exporting their products," said Costa Rican Ambassador Roland Saborio.

The ACP countries signed a second text whereby they committed themselves to the accord in general.

The US signed a third document committing to desist from filing further complaints with the WTO.

The main agreement was signed by the ambassadors to the WTO of the US, Brazil, Colombia, Costa Rica, Ecuador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Peru and Venezuela.

The signing is the first step before the later official signing, which will be carried out at least four months from now at an as yet undetermined location once all the legal and administrative procedures are taken care of.

After this step, the accord must pass through the European Council for approval before being signed once again by all parties.

Later, the European Parliament will ratify it and, once that has been accomplished, the certification of the new customs duties by the WTO will begin.