EU defends West Indies banana deal

22 July 1997

EU defends West Indies banana deal

The European Union is defending its special banana deal with African,
Caribbean and Pacific countries in an appeal to the World Trade
Organisation. It is contesting the WTO view that the EUs exclusive deal
on banana imports flouts WTO trading rules.

The WTO has already upheld a complaint by the US, Ecuador, Guatemala,
Honduras and Mexico that the EU was discriminating against their
producers and banana marketing companies. The EU had granted privileged
trading conditions to African, Caribbean and Pacific countries under the
Lome Convention. These countries are saying their economies will suffer
severe damage if this arrangement is banned.

Most trade experts believe the EUs appeal will fail and it will be
forced to open up its market. The EU favouritism is believed to have
cost the US companies Chiquita and Dole half their European sales.