ACP seeks EU clarification on outstanding banana support measures

By Ivan Cairo 

PARAMARIBO, Suriname, Monday November 26, 2012 – African Caribbean and Pacific (ACP) countries are seeking clarification from the European Union (EU) regarding outstanding pledges to support their banana sector.

At the start of the 24th ACP-EU Joint Parliamentary Assembly here, Suriname’s representative Rabin Parmessar, questioned alleged reports that the European Parliament has decided to reduce the amount of pledged financial support for the industry.

“We were informed that the European Parliament has decided to reduce the amount of the accompanying measures on bananas and we would like to know if that is correct”, said Parmessar.

He reminded his ACP and EU-colleagues that in 2010 the European Union decided to establish the supporting programme in order to help the ACP member states to cope with the new EU banana regime. The assistance programme was supposed to be set up and implemented in the period 2010-2013. According to the Surinamese legislator, preparation and implementation of the so-called Banana Accompanying Measures (BAM) has been delayed now for nearly three years.

“We wish to urge the EU to disburse all the resources announced and to guarantee full disbursement of the allocated resources and facilitate their optimum use”, he told the conference.

According to Parmessar the banana producing countries are appealing to the EU to engage in prior consultations with the ACP member states regarding any further reduction of the funds.

Banana exports from the ACP group of countries, including several Caribbean countries, have enjoyed preferential access to the EU for decades. But this trade regime has been subject to more than 15 years of legal disputes in the World Trade Organisation (WTO).

In December 2009, the EU finally reached an agreement with all parties concerned. The agreement reconciles the legitimate interests of two sets of developing countries exporting bananas – Latin American countries on the one hand, and ACP countries on the other.

It will cut the EU’s banana tariff for Latin American countries – its so-called Most Favoured Nation or MFN tariff – so the preferential margin which ACP countries enjoy will fall.

But ACP preferences will remain. The EU applies no import tariffs or quotas on bananas from ACP countries, and that will continue, under the terms of new Economic Partnership Agreements (EPAs) between the EU and groups of ACP countries.

In addition, the EU will continue its longstanding financial support to the banana sector in ACP countries. The Banana Accompanying Measures were designed to help those countries adjust to new trade realities over the next few years.

But the ACP countries have complained that the EURO 190 million (One EURO = US$1.29) for 10 countries over a four year period, have not been forthcoming.

Earlier this month, an agreement was reached at the World Trade Organization (WTO) ending an international trade dispute over bananas dating back two decades.

The December 2009 agreement involved the EU reducing its tariffs on imported bananas from EURO 176 per tonne to EURO 114 per tonne within eight years.

Latin American banana exporters had long protested against EU tariffs designed to protect small growers in former European colonies in Africa and the Caribbean.  They claimed that the EU import tariffs had favoured imports from former European colonies. (CMC) Click here to receive free news bulletins via email from Caribbean360. (View sample)