US goes bananas for EU deal with former colonies

The US finally got its way with one of the last great trade strangleholds over the weekend.

From The Associated Press:

The United States emerged victorious in the banana trade war after the World Trade Organization (WTO) declared the import tariff imposed by European Union (EU) on bananas to be illegal.

The WTO said the EU tariff of $254.9 a metric ton on bananas from Latin America was not warranted...

...The WTO ruling was the latest debacle for EU, which had been batting preferential trade deals for its ex-colonies in Central America.

Of the total banana consumption of the EU, Latin American bananas account for 60 percent of the EU market, African and Caribbean bananas taking in 20 percent and the remaining 20 percent provided by EU-grown bananas - mainly from Spanish and French islands.

While the US does not export bananas to EU, but three large US-based multinationals, including Chiquita, maintain plantations in the region.

And we know about those "great" US-based multinationals if you remember the film, Life and Debt, which deals with the decreasing banana trade in Jamaica.

From Life and Debt's website:

Central America is characterized by cheaper labor, a different soil type, high rainfall and a climate suited to large-scale banana production and thus more efficient. In 1993, a strike at Chiquita Farms in Colombia wherein 25,000 workers protesting for better wages was settled by firing shots at the striking workers and killing 40 people and the banana ships rolled insuring Chiquita's high rate of "efficiency." Jamaica's entire banana production could be produced by one farm in Central America. Banana's bring in 23 million US to Jamaica, comprising 8% of all exports. Yet, in the Windward Islands, bananas account for 50% of total exports. In St. Lucia, St.Vincent, bananas also comprise significant % of total exports, so quota loss will impact the entire Caribbean. At present the European Union has granted $600 million to help Jamaica become more efficient in their banana production so that they may attempt to compete on the "free market" in year 2000. The quota that is being so forcefully contested by US multinationals is under 5% of all global banana production. It is unlikely that the banana industry here could match the price of bananas from Central America. Already the number of small banana growers on the island have shrunk from 45,000 to 3,000.

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