Change to tariffs on bananas splits EU, ex-colonies at trade talks

GENEVA (AP)--African and Caribbean countries stood in the way of a deal July 27 that would end the European Union's long-running "banana war" with Latin American nations at the World Trade Organization.

The deal would benefit banana exporting nations such as Ecuador as well as multinational growers like Chiquita Brands International Inc. and Fresh Del Monte Produce Inc.

Brazil's Foreign Minister Celso Amorim told reporters late Sunday an agreement had been reached, but his comments clashed with those of African and Caribbean nations that currently benefit from preferential access to the European Union.

The EU has repeatedly been found in violation of global trade rules for favoring banana growers from mostly British and French ex-colonies.

The EU said it would be prepared to cut import charges on Latin American bananas to $179 per metric ton, down from $277, by 2016, according to the text of the offer which was seen by The Associated Press.

The offer was made at high-level talks in Geneva aimed at sealing a new global free trade pact. It improves slightly on a similar proposal the EU made earlier this month. It also drops an earlier demand that Latin American nations and the U.S. end all existing WTO complaints over the preferential treatment former European colonies receive when exporting bananas to the EU.

The U.S. has backed Latin American countries on the issue because U.S.-based companies such as Chiquita grow much of their banana crop in South and Central America.

African, Caribbean and Pacific growers, which currently pay lower tariffs when exporting to the EU, want financial compensation before agreeing to the banana deal, which would form part of the seven-years global trade talks known as the Doha round.

Cameroon's industry minister Luc Mbarga said his country would put forward an alternate proposal Monday, while a Jamaican delegate said on condition of anonymity because he wasn't authorized to speak to the media that the Caribbean nation wants a longer grace period before tariffs for its Latin American rivals are cut.

The bitter struggle over seemingly minor issues such as banana tariffs reflects the difficulty the Doha round has faced since it was launched in Qatar's capital in 2001. The round, which would force virtually all the WTO's 153 members to further open domestic markets to foreign competition, has to be signed off unanimously and as a complete package.

Ministers from major trade powers gave reporters a largely optimistic assessment of their closed-doors talks Sunday evening.

Indian Trade Minister Kamal Nath said his meeting with the U.S., European Union, China, Brazil, Japan and others had been "good and constructive" though several issues remain to be solved. His views were echoed by EU agriculture chief Mariann Fischer Boll.

But U.S. Trade Representative Susan Schwab said a "delicately balanced" package agreed on July 25 was threatening to unravel because of demands from "a few emerging markets." She declined to identify which countries are asking for last-minute changes.

"A lot of folks are going to have to put in a lot more time, unfortunately," Schwab said.

8/18/08
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Date: 8/8/08

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