Washington delays new sanctions list

Date: 22/06/2000

By Peter Chapman

Washington has delayed publication of the new list of products to be hit by more than €300-million worth of US trade sanctions in its disputes with the EU over beef and bananas until the end of this week.

But US sources insisted the delay was not designed to give the Union a chance to negotiate a last-minute solution to the two disputes before they escalate. They said the list, which was originally due to be published on Monday (19 June), had been held up while officials checked that the planned sanctions added up precisely to the €321.45 million allowed by the World Trade Organisation.

"This is a technical issue. They are trying to come down on the dot of the amount. You can imagine there would be some sort of complaint had they not done that," said one official. He added that the list was unlikely to include products which were not on the 'long list' of potential targets drawn up before the sanctions were first introduced.

The US has come under fierce attack from the EU over its plan to rotate the penalties every six months. Trade Commissioner Pascal Lamy has already launched WTO action against the move, claiming that it breaches the trade body's rules.

However, Lamy himself is also becoming increasingly impatient with the failure of Union governments to agree a possible solution to the banana dispute. Having initially proposed an interim regime before the Union scrapped all import quotas for bananas, he is now considering proposing that the EU moves to a tariff-only system immediately.

This is the approach most likely to find favour with the US, but it is being blocked by France, Spain, the UK and Italy because it would hurt producers in poorer countries and force the Union to pay out large sums in compensation from an already squeezed budget.

Washington has delayed publication of the new list of products to be hit by more than €300-million worth of US trade sanctions in its disputes with the EU over beef and bananas until the end of June 2000.