The European Union Ends the Banana War

The banana war is the longest running trade dispute in the world. The conflict centres on bananas that are imported to the European Union.

In the 1950s and 60s European colonies in Africa, the Caribbean and the Pacific region (known as ACP countries) became independent. In the 1970s the European Union started to let the Caribbean countries export bananas to European countries without putting tariffs on them. This was supposed to help these countries with their economies. Some of them only had bananas and other farminggoods to export. On the other side the European Union placed a tax on bananas that came from other countries, including the large banana-producing countries of Central and South America, like Ecuador and Honduras. The ACP countries,therefore, were able bring cheaper bananas to Europe.

Over the past decades this has led to a growing dispute between Latin American countries and the European Union. The banana-exporting countries think it is unfair to put tariffs on their bananas and not on the products coming from the ACP countries. The United States also got involved in the conflict, because the big banana producers in South America are large American companies, like Del Monte or Dole.

After years of talks there finally seems to be an end to the banana war. The European Union has agreed to slowly reduce its tariffs on Latin American bananas. Instead of paying 176 Euros for a ton of bananas that are exported to the EU these countries will only have to pay 114 Euros per ton in the next years.

Women washing and sorting out bananas in Central America

On the other side, The EU has promised to give ACP countries more money because they are afraid they will not sell so many bananas to Europe any more. As a result bananas imports from Latin American countries will increase. Bananas will get cheaper for EU citizens, probably by about 12 % over the next years.

The European banana market is the largest in the world. The EU imports almost 5.5 million tons of bananas every year. Most of them come from Latin American countries. These countries, like Ecuador, depend largely on bananas for theirincome. The European Union also has its own banana production. About 10% of all bananas sold in the EU come from Portugal, Spain, Cyprus, Greece and areasoverseas.

Banana-producing countries (in millions of tons per year)

Words

• agree = to say yes to something
• citizen = a person who lives in a country and has rights there
• decade = a period of ten years
• depend on = to need something
• dispute = quarrel, argument
• economy = a system that a country has for producing, buying and selling goods
• get involved = to get mixed up in
• goods = products
• including = together with, also
• income = here: the money a country gets for selling goods
• increase = to go up
• independent = free
• instead of = as an alternative
• overseas = another country that is across the ocean
• place = put
• promise = to say that you want to do something
• reduce = lower
• supposed to = thought to, believed to
• tariff = a tax on goods that go into or come out of a country
• tax = money that you must pay to the government for products you buy
• therefore = as a result
• trade dispute = two companies or countries argue about the buying and selling of goods.