Latin Americans hail WTO banana ruling
PANAMA CITY (Reuters) -- Latin America's major banana producers
hailed the World Trade Organization's ruling on Wednesday against
European Union banana import policies as a victory for free trade that
ends decades of discrimination.
In a case brought by the United States and five Latin American nations,
a panel of World Trade Organisation (WTO) experts ruled that the European
Union's (EU) new regime for the import and marketing of bananas violated
global trading rules and would have to be changed, diplomats and trade sources said.
"This is a sanction against the European Union for thinking it could mock
global trade laws," Enrique Gomez, president of the private National Banana
Producers Corporation of Ecuador, told Reuters.
Ecuador, the world's largest exporter, ships 16 percent of its production
the EU -- between 650,000 and 700,000 tons each year. Its total banana
exports in 1998 brought in $1.05 billion, with exports to Europe worth $328
In smaller banana producer Panama, which controls roughly 15 percent of
Latin America's banana exports to the EU, officials were also jubilant.
"Yesterday's judgment is a great triumph for the WTO ... which had to
put up with the interminable delaying tactics used by the EEC which pushed
the system to the verge of a terrible crisis," said Deputy Foreign
Commerce Minister Laura Flores.
"The final result should be the adaptation, once and for all, of EU
legislation to ensure a just and non-discriminatory treatment for our
bananas," added Panamanian Foreign Commerce Minister Raul Hernandez
at a joint news conference.
The decade-old "banana wars" pitted the United States and five Latin
American countries -- Ecuador, Mexico, Guatemala, Panama and Honduras
-- against the 15-nation EU.
The United States and Latin America argued the new regime, which took
effect in January and includes import quotas, violated earlier WTO
decisions. They said it favours former European colonies in the Caribbean
over Latin American producers, and gave preference to European
distributors over U.S. companies.
"This is a victory for all the countries that believe in free trade," Marithza
Vielman, a legal adviser for the Guatemalan Association of Banana
Producers, told Reuters.
De Vielman said the ruling would bolster Guatemala's banana export
industry, the country's third-largest with $190.4 million in 1998 exports. The
industry has been crippled by the European Union's unfair trade policies, she
Costa Rican officials were more cautious as they emerged from an
emergency meeting on the ruling, saying they would await the EU's response.
Last year Costa Rica produced a record 2.1 million tons of bananas,
representing $664 million in exports, industry officials said. That made it the
Central American nation's second largest industry after tourism.
The producers predicted the ruling would lead to increased exports. But
benefits will not be felt overnight.
Central American producers are still recovering from last year's devastating
Hurricane Mitch and other blows to agriculture, while industry growth
depends largely on international fruit companies' aims.
Honduran agriculture officials predict this year's exports will reach a
54,500 tons, compared to 509,000 tonnes in 1998, due to Mitch's damage.
Panama suffered a 23.8 percent drop in banana exports last year due to a
two-month labour strike and severe drought.
One of the region's smallest producers, Nicaragua may have less to
celebrate because the WTO ruling could eliminate quotas that guarantee it a
small share of the European market.