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US, EU sign deal to end long banana dispute

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(WASHINGTON) - The United States said Tuesday it had signed an agreement with the European Union aimed at ending a longstanding dispute over banana tariffs.

Under the pact, which formalized a deal reached on December 15, the EU agreed not to reintroduce measures that discriminate among bananas distributors, the office of the top US trade official said in a statement.

The EU also agreed to maintain a "non-discriminatory, tariff-only" regime for banana imports, said the statement by the US Trade Representative (USTR) office.

The US-EU pact complements an agreement between the EU and several Latin American banana-supplying countries signed on May 31.

That agreement provides for staged EU tariff cuts that will bring the grouping into compliance with World Trade Organization rules, the statement said.

Both the agreements will "enhance non-discriminatory market access opportunities" in the four-billion-dollar EU market for imported bananas, bringing "significant benefit" to US distribution companies and their workers.

The dispute over banana trade is the longest-running in the WTO, brought about by the EU's import regime introduced in July 1993.

"I am pleased that we, together with the Latin American banana-producing countries, have taken one more significant step toward ensuring that the EU's bananas import regime is consistent with its WTO obligations," USTR Ron Kirk said.

"All the parties still have some distance to travel before we finally and conclusively settle the bananas dispute," he said.

"However, we are closer now than we have ever been and I am hopeful that we will be able to finally lay this longstanding dispute to rest in the near future."

The US and Latin American nations had separate complaints at the WTO over the EU tariffs in a dispute that had been festering since 1993.

Although the US is not an exporter of bananas, Washington had complained about inconsistent tariffs that violate WTO rules and discriminate against US producers that operate in Latin America, notably Chiquita, Del Monte and Dole.

While bananas shipped from Latin American countries are subject to import taxes, those from mostly poor former European colonies in the African Caribbean and Pacific (ACP) region enter the bloc tariff-free.

However, the banana dispute as a whole can only be fully resolved if the EU also secures an accord with its ACP partners on compensation to help them cope with the tariff changes.

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