Brussels/Washington, 02/07/2001 (Agence Europe) - The European Commission welcomed the lifting of American sanctions, this Monday 1 July, in accordance with the arrangement concluded last April in view of putting an end to the eight years of trans-Atlantic "warring" over the trade in bananas.
"This is great news for European exporters", welcomed the Commissioner responsible for Trade Pascal Lamy, in a communiqué released a few hours after the announcement of the decision by Washington, which arose on Sunday night. "A whole cluster of products that had attracted prohibitive duties will once more be available to American consumers at normal prices", he underlined, while also recalling the threat of rotating sanctions that weighed on other parts of European industry and, notably, the suppliers of cashmere sweaters and candles. "We solved this problem, and we showed that we can work together to manage trade disputes in a business-like manner. This is a very good signal at a time when we are working together on launching a new round of global trade talks", he felt. The Agriculture Commissioner Franz Fischler as for him was "pleased that a solution has been reached under which these trade restricting sanctions no longer apply". He also insisted once more, possibly the last time: "This solution fully preserves the interests of the EU producers and consumers as well as those of out ACP and Latin American suppliers".
The sanctions, which weighed on European trade for two years covered trade valued at USD 191.4 million per year, equalling the prejudice caused to American industry by the Community system for the importing of bananas, which saw the light of day on 1 July 1993. The United States auto-compensated themselves for this entire period, with the approval gained a little tardily from the World Trade Organisation (WTO), by imposing increased duties - up to a prohibitive level of 100% ad valorem - on imports of a series of products from the Union, including bath oils, hand bags, car batteries, cardboard boxes, linen, lithographs and percolators. Some European firms particularly suffered from these surcharges, which increase the price of their products to such an extent that they have become practically inaccessible in the United States. This is notably the case with bath oils from the British "The Body Shop" and the French "Le Laboratoire du bain", boxes from the German "Carton Druck", batteries from the Italian FIAM or also the handbags from "Louis Vitton" and "Gucci".
Last April, drama: the Union and the United States announced they finally reached a solution to put a final end to their oldest dispute, a dispute as old as the WTO and languishing for even longer. To arrive here, the European promised to renounce their option of access to the Community market known as the "first come, first served" policy, which was preferred by Ecuador, to the benefit of the mechanism based on the tariff references post-1993 (1994-1996), favoured by the Latin American and Caribbean suppliers, also more favourable towards American suppliers of their bananas, in particular the multinational Chiquita Brands International, which threatened the Union with a further legal action. Secured firstly after the rejection by Quito - the second party directly involved in this case - the arrangement finally received the "green light" from Ecuador. In the rush, the Commission reviewed the details for the banana regulation in the direction agreed and published the new regulation in the Official Journal N°L126 of 8 May (pages 6-16). Washington acted just after this move by lowering, as agreed, the rates of duty to their normal level. "The EU has complied with the first phase of the understanding, and so today the United States will lift its retaliatory duties", stated the Trade Representative Robert Zoellick. "This process represents a serious effort by the United States and the EU to manage differences in a spirit of mutual respect, understanding and constructive action", he added.
EUROPE recalls that this arrangement also includes a double promise, targeting: - the repeal of Community quotas and the establishment of an exclusively tariff based system for the importing of bananas, on 1 January 2006; - Washington's support to the issuing of "waivers", which will allow the EU to continue giving a preferential treatment to the suppliers from Africa, the Caribbean and Pacific, and for the Cotonou agreement with these same countries to pass the WTO test.