Fundamental splits remain over reform of EU banana regime

Date: 12/02/1998

By Leyla Linton

EU FARM ministers are unlikely to make much headway in narrowing their differences over reform of the Union's banana regime when they discuss the European Commission's proposals for the first time next week.

Government officials have been working intensely over the past two weeks to clarify aspects of the plan to modify the EU banana import regime to comply with a World Trade Organisation (WTO) ruling.

However, the fundamental question of whether member states judge the Commission's solution to be compatible with WTO requirements will not be broached until next week's ministerial meeting. Officials say ministers will avoid "too much discussion because it would crystallise their positions".

The Union is being forced to change its banana regime after a WTO dispute panel upheld complaints from producers in the US and Latin America that the EU import licensing system favoured producers in the African, Caribbean and Pacific (ACP) countries.

The Commission's proposal to leave the basic quota arrangements unchanged and abolish the current import licence allocation scheme. has come under fire from all sides.

Rita Hayes, the US permanent representative to the WTO, said it was "appalling" that the Commission continued to suggest changes which were not compatible with WTO requirements.

EU member states are divided between those who feel that the Commission's proposal leaves the ACP countries out in the cold and those who believe it does not go far enough to meet the WTO ruling.

One major sticking point for all member states is the plan for distributing quotas, amid concern that current proposals leave too much to the Commission's discretion.