Negotiations at WTO level on the long-running banana dispute between the EU and Latin American countries were overshadowing the Doha round of trade talks in Geneva on Wednesday.
Diplomats feared that a failure to settle the banana issue separately could lead to their inclusion in the Doha round in WTO negotiations on tropical products. This could result in much bigger tariff cuts than those proposed by the WTO or EU on bananas.
Latin American and African Caribbean Pacific countries have been negotiating over 42 overlapping items on their lists of tropical products. Latin American negotiators were proposing allowing ACP countries to keep 30 products while they would retain 12 on their list. But if both want to include bananas on their lists agreement would be more elusive than ever.
The African Caribbean Pacific lobby reacted angrily to the proposal from WTO director-general Pascal Lamy for a gradual reduction in the import tariff to solve the dispute and the Latin Americans are disappointed that the concessions are not generous enough.
“On the basis of a ‘good offices’ proposal, Mr Lamy has proposed a compromise solution to the banana dispute without however consulting the ACP banana producer countries,” the ACP delegation said.
“By sanctioning such unacceptable tariff cuts, this compromise solution puts ACP banana production in an irreversible jeopardy by giving undue advantage to the Latin-American producers who already account for 80 per cent of the Community’s banana imports, to the detriment of the ACP and Community banana productions.”
Lamy’s proposal is that Europe gradually reduce its import tariff to €116 (£92) a tonne by 2015, from the current rate of €176.
But the ACP lobby is convinced the proposal will do irreparable damage to their countries. The delegation said: “Under the present circumstances, this compromise solution would ruin all the ACP countries’ chances of participating actively in the multilateral trade system, as strongly advocated by the multilateral financial institutions such as the IMF and the World Bank.”
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