US enters banana war against EU at WTO
Sunday, 1 July 2007
WASHINGTON, June 30 (Agencies): The United States yesterday joined the "banana war" at the World Trade Organisation (WTO), alleging the European Union treats Latin American producers unfairly.
US Trade Representative Susan Schwab said the United States requested a WTO panel to review "whether the European Union's banana import regime breaches the EU's WTO obligations" of more than a decade ago.
The United States claims the European Union failed to implement WTO rulings in a 1996 action initiated by Ecuador, Guatemala, Honduras, Mexico and the United States.
That WTO ruling said the EU banana regime discriminates against producers of Latin American bananas as well as their distributors, including several US companies, the USTR said.
The EU was obliged to bring its banana regime into compliance with its WTO obligations by January 1999.
"We regret that efforts between the EU and its Latin American trading partners to negotiate a solution to the banana issue have not been successful," Schwab said in a statement.
"We share the concern of Ecuador and several other Latin American banana exporters regarding the continued existence of a discriminatory tariff rate quota in the EU's current banana regime. We are hopeful that this formal step will facilitate the removal of that discrimination."
Schwab noted a similar request for the establishment of a panel was submitted by Ecuador on February 23, and in response a WTO compliance panel was set up on June 15. Colombia filed a complaint in March.
The WTO once before authorised Ecuador and the United States to take action against the EU for its failure to implement the 1996 rulings.
The United States ended that action after the EU committed to shift to a tariff-only regime for bananas no later than January 1, 2006, the US trade official said.
Despite those commitments, the EU banana regime features a zero-duty tariff rate quota that is allocated exclusively to bananas from African, Caribbean and Pacific (ACP) countries, she said.
ACP countries, many of them former European colonies, benefit from more favourable terms of access to EU consumer markets. By contrast, bananas from Latin America are subject to a customs duty of 176 euros per ton.
Four-fifths of the bananas imported by the EU are grown in Latin America. Under WTO rules, the defending party may veto the request of a ruling by a panel of neutral trade experts, but it automatically goes ahead up to a month later unless the complaint is withdrawn.
Nearly all countries use the delaying tactic.
The US complaint against the EU comes amid heightened tensions in the global trading system, after the collapse earlier this month of an effort by the so-called "G4"-the United States, European Union, Brazil and India-to resuscitate the Doha Round of WTO negotiations.
Meanwhile, blaming the developed world's "serious gap of attitude" as the reason behind failed talks, India has said that it is still optimistic about Doha development round concluding positively.
"There is a serious gap of attitude because of which the talks had failed," said Indian Commerce Minister Kamal Nath, who is cut up with the hardened attitude of the US on agriculture subsidy issue.
Nath's remark comes week after the US, Indian, the European and Brazilian negotiators abandoned talks in Potsdam in Germany.
The Indian minister, however, said "I don't see Doha development round petering out but hope to see it coming to a conclusion."
Nath, who was speaking at a meeting organised by the Commonwealth Business Council here last night, said the G4 (US, India, EU and Brazil) had its day. "The G4 process has ended. We need to make it larger," he said.
Answering a question on outsourcing, Nath said there was no point in blaming the outsourcing for job losses. "It is shifting employment pattern and technology which is affecting globally," he said, adding the future would be dictated by technology and demographics than tariff. "If countries do not see this they are making a mistake," he said.
US Trade Representative Susan Schwab said the United States requested a WTO panel to review "whether the European Union's banana import regime breaches the EU's WTO obligations" of more than a decade ago.
The United States claims the European Union failed to implement WTO rulings in a 1996 action initiated by Ecuador, Guatemala, Honduras, Mexico and the United States.
That WTO ruling said the EU banana regime discriminates against producers of Latin American bananas as well as their distributors, including several US companies, the USTR said.
The EU was obliged to bring its banana regime into compliance with its WTO obligations by January 1999.
"We regret that efforts between the EU and its Latin American trading partners to negotiate a solution to the banana issue have not been successful," Schwab said in a statement.
"We share the concern of Ecuador and several other Latin American banana exporters regarding the continued existence of a discriminatory tariff rate quota in the EU's current banana regime. We are hopeful that this formal step will facilitate the removal of that discrimination."
Schwab noted a similar request for the establishment of a panel was submitted by Ecuador on February 23, and in response a WTO compliance panel was set up on June 15. Colombia filed a complaint in March.
The WTO once before authorised Ecuador and the United States to take action against the EU for its failure to implement the 1996 rulings.
The United States ended that action after the EU committed to shift to a tariff-only regime for bananas no later than January 1, 2006, the US trade official said.
Despite those commitments, the EU banana regime features a zero-duty tariff rate quota that is allocated exclusively to bananas from African, Caribbean and Pacific (ACP) countries, she said.
ACP countries, many of them former European colonies, benefit from more favourable terms of access to EU consumer markets. By contrast, bananas from Latin America are subject to a customs duty of 176 euros per ton.
Four-fifths of the bananas imported by the EU are grown in Latin America. Under WTO rules, the defending party may veto the request of a ruling by a panel of neutral trade experts, but it automatically goes ahead up to a month later unless the complaint is withdrawn.
Nearly all countries use the delaying tactic.
The US complaint against the EU comes amid heightened tensions in the global trading system, after the collapse earlier this month of an effort by the so-called "G4"-the United States, European Union, Brazil and India-to resuscitate the Doha Round of WTO negotiations.
Meanwhile, blaming the developed world's "serious gap of attitude" as the reason behind failed talks, India has said that it is still optimistic about Doha development round concluding positively.
"There is a serious gap of attitude because of which the talks had failed," said Indian Commerce Minister Kamal Nath, who is cut up with the hardened attitude of the US on agriculture subsidy issue.
Nath's remark comes week after the US, Indian, the European and Brazilian negotiators abandoned talks in Potsdam in Germany.
The Indian minister, however, said "I don't see Doha development round petering out but hope to see it coming to a conclusion."
Nath, who was speaking at a meeting organised by the Commonwealth Business Council here last night, said the G4 (US, India, EU and Brazil) had its day. "The G4 process has ended. We need to make it larger," he said.
Answering a question on outsourcing, Nath said there was no point in blaming the outsourcing for job losses. "It is shifting employment pattern and technology which is affecting globally," he said, adding the future would be dictated by technology and demographics than tariff. "If countries do not see this they are making a mistake," he said.