MEPs banana split over EU subsidies

BananasMEPs have demanded more money for Europe's banana growers who aren't even in Europe. They want extra cash to help banana growers in those well-known "European" regions of France's La Réunion (Indian Ocean), Guadeloupe and Martinique (Caribbean) and Guyane (borders Brazil), plus Portugal's Azores (off north America).

Trade war

The Euro parliamentarians backed a plan to end a 16-year trade war with Latin America over bananas by cutting the tariff on Latin American imports. But the Brussels politicians said the help offered to Europe's "outermost banana-producing regions" was not big enough and not available for long enough.

The 2009 Geneva agreement on trade tariffs for bananas from Latin American countries is designed to end the longest-running dispute in the history of international trade. It cuts the tariff on Latin American bananas from €176 a tonne to €114 a tonne in 2017. It was finally endorsed yesterday.

And, although the MEPs backed the deal, they said the special financial provisions for the EU and African, Caribbean and Pacific (ACP) producers needed bolstering. This is already earmarked to be as much as €200m – to help the banana growers become more efficient so they can compete.

The MEPs demanded cash support until 2020 and urged the EU to take other steps to ensure that "domestic" EU producers are able to stay in the market.

Banana skin

The EU has been illegally giving preferential treatment to banana exporters in African, Caribbean and Pacific (ACP) countries. Now, in addition to regular EU aid, those countries will get the extra help from the EU budget (up to €200m) to compensate for the EU's improving trade relations with Latin America.

MEPs rejected any attempt to finance the extra support from money earmarked for development cooperation, demanding fresh money from additional resources.

The EU is the world's largest banana market. More then 70% of bananas sold in the EU come from Latin America (mainly Ecuador, Colombia, Costa Rica and Panama), around 20% come from ACP States (chiefly Cameroon, Côte d'Ivoire, Dominican Republic, Belize and Surinam).

The rest are grown in the EU itself (Cyprus, Greece, Madeira, Canary Islands and French overseas departments of Guadeloupe and Martinique).

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