Brussels, 03/03/2004 (Agence Europe) - Banana producers from the Cameroon and Ivory Coast are worried by the consequences of EU enlargement. They want quotas soon to be granted to new Member States, to be adapted to what is actually consumed in these countries in order to prevent further significant falls in market prices.
The Independent Union of African Banana Producers (UPIBA), an organisation recently set up to defend the interests of banana producers in the Cameroon and Ivory Coast, organised a round table on this theme in Brussels on Tuesday, in which participants included the Cameroon Ambassador Isabelle Bassong, delegates from permanent representations from EU Member States, MEPs and African business operators. During a press conference at the end of the meeting (closed to the public), the UPIBA expressed some of fears of African producers about the next enlargement of the EU and criticised the attitude of the European Commission (DG Agriculture), which it affirms had refused to initiate any dialogue with the concerned parties (operators as well as governments from future Member States), whereas important decisions were in the offing.
By 15 March, at the latest, the "banana" management committee is expected to set the supplementary import quota for the Union (which is increasing from 15 to 25 members). African banana producers are planning on an additional quota of 350,000 tonnes, whereas the Commission could propose a quota of 55,000-600,000 tonnes. According to the UPIBA, these changes to the Community system could provoke a fall in prices. In 1995, during the last enlargement of the EU (Austria, Finland, Sweden), a quotas was fixed by the Commission that was too high, causing over supply to the European market and a very damaging fall in prices for African producers.
Second case study: rather than setting the quotas for the new countries, the Commission could decide to move more swiftly (2005 instead of 2006) to an exclusively Community tariff system. To put a stop to the "banana war" pitting the USA against Latin American countries, the EU in 2001 called on the WTO to end the quota system by 1 January 2006 at the latest (to replace it with a customs duty based system). The Commission has explained that it will, in any case, b necessary to set quotas for new countries to cover the period between 1 May 2004 and the date of entry into force of the exclusive tariff system. Although this scenario of a more rapid transition to the new system has just been presented, African producers will be requesting: a customs duty differential of EUR 250/tonne; or a differential less than EUR 250/t but accompanied by compensation aid.
UPIBA, which was set up in emergency circumstances, has not had the time to co-ordinate its action with Community producers but has provide assurances that some of these producers share UPIBA's worries. According to UPIBA president, Christian Métadier, Community producers also want to limit the quotas to the ten new Member States to prevent what happened at the 1995 enlargement. According to Métadier, producers from the Antilles (Martinique and Guadeloupe) are in a real crisis situation because they are suffering the backlash of falling prices and because the EU compensation system is not sufficient. In effect, the EU sales average employed for calculating aid is based on production from the Canary Islands who have better sales than the Antilles, explained the president of the association.
Putting a stop to the trade triangle in import licences
UPIBA considers that the last two reforms of the Community system between 1999-2001 provoked further market imbalances: as well as the constant fall in prices, aid in 2000 (as part of the "technical and financial aid" package) has still not been released; due to changes introduced in 2001 (reduction from 850,00 to 750,000 tonnes in the quota from ACP countries), the EU instituted a system that generates a trafficking in licenses.
Although the cost of European market access should be nothing for African countries, producers from these countries are compelled to pay an operator from the Caribbean and Latin America, a market access duty, explained Mr Métadier, who also explained that the Cameroon and Ivory Coast had to buy licenses for an annual volume of 150,000 tonnes.
The price of the license currently costs between EUR 1.5 and EUR 2 per 18 KG basket, as opposed to EURT 0.5 two years ago. Participants at the round table said that the triangular market in licenses should be ended and requested, in this context, a redistribution in the total banana quota, between African and Caribbean countries in order to take into account the references of real exports Upiba represents "medium" African banana producers, which occupy a sizeable place on the market. Members of this organisation represent 27% of total exports of African bananas to the EU. Cameroon, the world's 8th-largest producer, produced 6% of all bananas sold in the EU in 2000 (FAO figures), or 230,000 tonnes. Côte d'Ivoire, the 9th largest producer, produced 5% of bananas sold in the EU (211,000 tonnes). Of a total of 4 million tonnes of bananas sold in the EU in 2000, 18.6% came from ACP countries, 62.1% from Latin America ("banana dollar") and 19.2% from extremely remote areas of four Member States of the EU (Martinique and Guadeloupe for France, the Canary Islands for Spain, Madeira and the Azores for Portugal, and Crete and Laconia for Greece).