Brussels, 18/11/2005 (Agence Europe) - The Commission has changed its tactics and proposed to the Member States the application of customs duty of 179 EUR per tonne on imports of bananas to the EU from the countries of Latin America, as of 1 January 2006. In line with an agreement between all members of the WTO at the end of 2001, the EU had agreed to change its challenged import quota system for bananas into a solely tariff-based system. Both previous proposals (187 and 230 EUR/tonne) were, according to the dispute settlement panel of the WTO, too high to allow the Latin-American exporters to maintain their share of the European banana market (Brazil, Costa Rica, Colombia, Ecuador, Honduras, Guatemala, Nicaragua, Panama, Venezuela: EUROPE 9059). The Commission has also suggested a quota of 775,000 tonnes with no customs duty for the ACP countries, which enjoyed privileged access to the European market by virtue of the Cotonou agreement, alongside this new import tariff of 179 EUR/tonne.
At the meeting of the Committee of Permanent Representatives of the EU (Coreper), there was no qualified majority in favour of the new level of customs duty proposed by the Commission. In the view of Germany, Sweden, Denmark, the Netherlands, Poland, Lithuania, Slovakia and the Czech Republic, which import "dollar" bananas sold by the American multinationals Chiquita, Dole and Del Monte in Latin America, this new customs duty remains too high. Criticism has been levelled mainly by the new Member States, which imported "dollar" bananas freely before they joined the EU. In the opposing camp, Spain, France, Portugal and Cyprus, together with Italy, Ireland and Finland (out of solidarity with the Community producing countries), supported the Commission's proposal. The dossier will be discussed at the General Affairs Council of 21 November. The proposal may be adopted without debate at the Ecofin Council of 24 November. In order to achieve a qualified majority in favour of its proposal, the Commission is trying to soften up the new Member States, by agreeing to grant them easier access for bananas from the ACP zone.
Today, the EU applies customs duty of 75 EUR a tonne for imports of bananas from Latin America, up to a quota of 2.2 million tonnes, after which the tariff jumps to 680 EUR per tonne for non-quota imports. The Commission plans to impose the new duty of 179 EUR/tonne for the first six months of 2006, then to assess the market share of the Latin American countries, which are demanding that the current rate (75 EUR/tonne) be kept in place. After six months, the Commission may reduce this tariff if it can be demonstrated that the dollar banana is losing market share. The Latin American countries may table a further complaint to the WTO, which would take two years to reach its final decision. They are asking for the start date for the new level of customs duty of 179 EUR to be postponed, for as long as it takes to find an amicable solution. For the ACP countries, the Commission has proposed to the WTO that the "waiver" be extended- the derogation allowing a preferential regime to be applied to ACP bananas. In order to extend this, threequarters of the WTO members must agree, but in practice, consensus is required. The Commission is counting on the negotiation of economic partnership agreements (EPA) to reach a solution when the derogation granted to the ACP countries eventually expires.
The Association of European Banana Producers (APEB) "fears" that by setting customs duty of 179 EUR/tonne now, the Commission may be giving the Latin American producers "the opportunity immediately to challenge this new tariff level and to obtain a substantial reduction during the negotiations" of the WTO in Hong Kong. The APEB would have preferred the current common market organisation to be kept in place provisionally "pending a sustainable and negotiated solution, an option which would have set the course of the meeting of the WTO in December.