The end of the long-running banana dispute between the US and the EU could be in sight after both countries struck a deal to lift sanctions.
The EU said on Wednesday that the US had agreed to suspend US$191m of sanctions on European Union goods on July 1. The sanctions were imposed by the US after it won a World Trade Organisation (WTO) ruling against the EU’s current banana import rules.
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The deal brings to an end the eight year dispute between the trading blocks.
EU Trade Commissioner Pascal Lamy said an agreement in principle had been reached with the US administration: “(EU Farm) Commissioner (Franz) Fischler and myself believe that after several years of difficult negotiations we have been able to strike a balance between all parties concerned.”
The agreement must now be endorsed by EU governments and the European Parliament.
Under the agreement, the EU will scrap its plans to introduce a “first come, first served” system of distributing banana licences on July 1. After that period, licences will be allotted based on the way they were distributed during an “historical reference period” of 1994-96. The Commission still plans to move to a tariff-only system from 2006.
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By GlobalDataThe US has previously condemned the EU’s banana import rules, arguing they strongly favour growers in former European colonies over Latin American producers and US companies, Chiquita Brands International and Dole Food.
