Banana ruling splits EU on response to WTO

10 September 1997

Banana ruling splits EU on response to WTO

European ministers must agree how to dismantle parts of the European Union (EU) banana import regime after the World Trade Organisations appeals body upheld that it broke world trade rules. How they will do this is unlikely to become clear for some months.

The 15 EU countries are understood to be split with nine ready to change the rules but six against, including the UK, France and Spain. This could form a blocking minority under EU voting rules.

The EU will have to compensate the Latin-American producers who initiated the complaint if it does not comply.

There are fears that associated trade in produce such as avocados and citrus fruit could be damaged in the Caribbean, whose banana trade the EU regime protect. The Caribbean Banana Exporters Association said they relied on banana trading boats that might no longer visit the nine main Caribbean trading ports.

It urged the EU to compensate the complaining countries rather than dismantle the regime or insist it had commitments to protect Caribbean producers under the Lome Convention. Ecuador insisted the Caribbean banana trade with the UK and France would survive.