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Indian Economy

Notes (b) There are three broad quota categories: the first two are “A” and “B” quotas on
imports of bananas from non-ACP countries, the total being 2,653,000 tonnes.
(c) The “C” quota will be 750,000 tonnes and will be reserved for bananas of ACP
origin.
(d) Duties on bananas imported under “A” and “B” quotas will not exceed 75 €/tonne
until the entry into force of the EC’s tariff-only regime.

(e) The third category, “C” quota, is on banana imports from ACP countries. No duties
will be charged on bananas imported from “C” quota countries.
(f) The waiver will also apply till EC’s tariff-only quota is introduced from January 1,
2007.
(g) The Doha Decision also waives Article XIII of the GATT 1994 – Non-discretionary
Administration of Quantitative Restrictions – in respect of EC’s banana imports.
This means that the EC can have quantitative restrictions (QR) favouring imports of
bananas from ACP countries over non-ACP countries. However, the EC will have to
negotiate with the different banana exporting countries (those “with principal
supplying interests”) before it decides the final quantum of imports.
The Future
The dispute was essentially between the “large” American-backed Latin American
producers and the “smaller” banana producers in the Caribbean and other countries that
have a colonial or historical connection with the European countries. For example, France
reserved its market essentially for bananas from the Caribbean islands of Martinique and
Guadeloupe and West Africa. The UK also gave priority access to Commonwealth
Caribbean bananas, and restricted imports of dollar bananas. These arrangements, in
general, ensured a remunerative return for Caribbean growers exporting bananas to the
European markets.
The tariff-rate quota now envisaged allows for imports of 2,553,000 tonnes bananas under
“A” and “B” quotas (non-ACP countries). These imports will be levied a duty of 75 Euro/
tonne. The “C” quota of non-dutiable imports from ACP countries will be set at 850,000
tonnes. This tariff-rate quota regime will be effective from January 1, 2002.
The United States agreed to provisionally remove its 100% import duties on specified
products from the EU. However, the US in its communication to the WTO, has kept the
option of re-imposing high duties on imports from EU if the revised tariff-rate quota
regime was not implemented from January 1, 2002. There have also been political voices
in Europe that the tariff-only regime to be implemented from January 1, 2006, would be
harmful to small banana producers in the ACP countries. Moreover, the Cotonou
Agreement signed in June 2000 on the basis of a “strong political foundation” is valid for
twenty years.
Questions

1. Find out the banana trade, in terms of quantity and US dollar value, for the years
1995 to 2000, between:
(a) Guatemala, Honduras and Ecuador and the EC.

(b) The Caribbean countries and the EC.
(c) Chiquita and Dole companies and (i) the EC market, and (ii) Rest of the world.

Contd...

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