WTO warns Europe on banana tariffs

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Acting on a complaint filed by Latin American banana producers, the World Trade Organization on Monday said that the European Union cannot implement a planned tripling of import duties on that fruit. The EU has ten days in which to open new talks on the tariff. If it does not do so, or if no deal can be reached in new negotiations, either side can apply to the WTO for further arbitration of the dispute. The WTO ruled that the higher duty, 230 euros ($278.3) per tonne rather than the current 75 euros, would lessen the chances of Latin American banana producers from competing in European markets. The WTO did not say in its ruling what it thought a fair tariff would be. The problem with the EU tariff plan was that it would work to give privileged access to former European colonies in the Pacific, the Caribbean, and Africa, over Latin American banana producers such as Ecuador, Colombia, Costa Rica, Guatemala, Honduras, Panama, Brazil, Nicaragua and Venezuela. In their complaint to the WTO, the Latin American nations said that the EU plan threatened job losses in the hundreds of thousands in their countries. Complicating the matter is the fact that the countries that would be aided by the EUs tariff plan want the tariff on Latin American bananas to be even higher than that proposed by the EU due to the higher production costs in their nations.