(BRUSSELS) - The European Commission said Wednesday it was ready to make concessions in a long-running trade dispute with Latin America over bananas in order to advance struggling WTO negotiations.

The commission said it was prepared to accept a settlement proposed by WTO chief Pascal Lamy that calls for Europe to gradually reduce its import tariff to 116 euros (185 dollars) per tonne by 2015 from 176 euros currently.

Latin American banana producers have successfully challenged the EU's banana import regime before the World Trade Organisation on the grounds that it discriminates against them in favour of poor African, Caribbean and Pacific countries.

ACP banana producers, many of which are former European colonies, have long benefitted from preferential market access under the European Union's import regime, much to the concern of their Latin American rivals.

Under Lamy's proposals, Latin American countries would agree to a "peace clause," in effect promising not to reopen the case in return for the lower tariff.

The EU offer comes days ahead of crunch WTO meeting aimed at reviving the Doha round of global free-trade negotiations, which have stalled in part over tensions between Europe and Latin America on farm products.

The commission said that a solution to the banana dispute would in turn give a boost to WTO negotiations on tropical products, one of the main sticking points within the farm talks.

"Resolving this long running problem must be part of a final Doha deal," EU Trade Commissioner Peter Mandelson said in a statement.

"That means balancing the needs of two different sets of developing countries, while taking into account the interests of EU banana producers," he added. "Pascal Lamy's proposals have given us a basis to do that."

Although the United States does not export bananas to the EU itself, it too won a WTO lawsuit against the EU's import regime, which it filed because three of the largest producers with plantations in Latin America are US-based multinationals -- Chiquita, Del Monte and Dole.

The commission has vowed to appeal the WTO ruling in that case.

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