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International Banana Congress to analyse new market rules

The change in the rules of the association agreements that 96% of Latin American banana-producing countries maintain with the European Union (EU) will be discussed during the 7th International Banana Congress, which will be held from 26 to 29 September in Miami.

The congress is organised by the National Banana Corporation (Corbana) of Costa Rica and one of its main goals is to study the effects of the EU decision to liberalise the banana import model of Latin America by 2020.

"The liberalization of EU banana imports will take place in 2020, which means that Latin American producers will have the option of shipping as much fruit as they can, paying a tariff of 75 Euro (about 87 dollars at the current exchange rate) per tonne; much lower than what they are currently paying," pointed out Corbana in a statement.

At present, there is a banana stabilization mechanism, by means of which a maximum reference volume is set for each country, and if it is exceeded, the mechanism allows for the suspension of the tariff preference and the application of the tariff consolidated by the World Trade Organization (WTO).

Once the market is liberalised, exporting countries such as Ecuador, Colombia, Costa Rica, Panama, Guatemala, Peru, Nicaragua and Honduras will be able to export as many bananas as they can, practically without any other restriction rather than the actual demand.

"Setting a reference volume for each country was a measure that the EU introduced to protect its own producers: the Canary Islands, Madeira, Guadeloupe and Martinique, as well as the European ex-colonies in Africa, the Caribbean and the Pacific," said Corbana manager Jorge Sauma.

In the case of Costa Rica's export, it is governed by the negotiation of the EU Association Agreement with Central America, which came to a close in 2010 and was implemented in 2013 and foresees that the banana import tariff would be gradually reduced, going from 145 Euro (about 168.2 dollars at the current exchange rate) to 75 Euro (about 87 dollars) per tonne in 2020.

The statement said that "the separation process of the UK from the EU will also be completed by that time, so the Congress will also serve to discuss the impact of 'brexit' on international trade."

Publication date: 8/8/2017


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