Saturday, December 2, 2006

by Jeremy Smith

BRUSSELS, Belgium (Reuters): Colombia has filed a complaint at the World Trade Organisation (WTO) against the European Union's import duty for bananas to support neighbouring Ecuador in a similar complaint, an industry source said on Thursday.

"Colombia today has formally filed. They're coming in as a third party (to support Ecuador)," the source told Reuters.

Earlier this month, Ecuador - the world's largest banana exporter - launched its own challenge against Brussels over the EU's single tariff of 176 euros ($232.20) a tonne, in force since January 2006, saying it was far too high.

During 2005, while the EU's executive Commission was negotiating the level of its new tariff, WTO panels slapped down two previously proposed EU duties of 230 and 187 euros, saying they were too high and discriminated against Latin America.

The single-duty system, to replace a complex arrangement of duties and quotas, was agreed with the WTO to end the 1990s "banana wars" that Europe lost to Ecuador and the United States.

Last December, Norwegian Foreign Minister Jonas Gahr Stoere took on the task of overseeing a process of monitoring EU banana imports and prices, with a view to finding a political solution to the tariff problem.

"This is very regrettable," said Michael Mann, European Commission spokesman for agriculture. "We had a consultation process going which we felt was making good progress."

"Latin American banana exports are eight percent higher this year than they were last year," he said.

Bananas are a sensitive issue for the EU, which gives preferential access to bananas from countries in the African, Caribbean and the Pacific (ACP) group.

ACP bananas enter the EU's lucrative markets free of duty, inside an annual quota of 775,000 tonnes, although anything shipped above that volume attracts the standard 176-euro duty.

Before the new regime entered into force, Latin exporters paid 75 euros per tonne, within set quotas, to get their fruit into Europe. Anything above that faced a duty of 680 euros.

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