July 14, 2007
COMMENTARY: U.S. Gone Bananas
By Sir Ronald Sanders
Special to Huntington News Network
In a most remarkable development following closely on the heels of a meeting in Washington between US President George W Bush and heads of government of Caribbean Community (CARICOM) States, the United States has taken an action at the World Trade Organisation (WTO) that will hurt the economies of Caribbean banana exporting countries.
The United States, which does not export bananas, lodged a complaint on June 29, 2007 to the WTO against the banana importing regime of the European Union (EU) saying that it harms exports from Latin American nations such as Ecuador, Honduras, Panama and Nicaragua.
On July 12th, the Dispute Settlement Body of the WTO agreed to set up a panel to examine the US complaint against the EU banana regime.
Undoubtedly, the decision of the Panel will go the route of every other panel that has pronounced on this issue since May 1997: it will instruct the EU to change its banana importing regime to stop any advantage, however miniscule, that African, Caribbean and Pacific (ACP) states enjoy.
This is because WTO rules – formulated largely by the world’s richest nations, especially the US and the EU – say in general terms that the rules apply equally to all however large or small, rich or poor. In this connection, the EU banana importing regime would be wrong to give any advantage, however slight, to small and vulnerable countries.
The EU regime, which has been battered since 1997 because of challenges at the WTO led by the US, does give a little advantage to small Caribbean countries to supply a miniscule amount of the EU’s banana imports. And, this is the point: it is a little advantage for only a very small share of the market. Equity and fairness should dictate that a little advantage in these circumstances is wholly acceptable.
In the process of these challenges, CARICOM banana exporting countries saw the industry decline, foreign exchange earnings decrease and unemployment rise. The lives of simple people were thrown into confusion.
If this most recent request by the US government for a WTO Panel wasn’t’ so seriously harmful to small Caribbean countries, it would be laughable.
Just imagine; the US appears to be defending Nicaragua against the CARICOM states. Yet, it is the Nicaraguan government that has joined Venezuela’s President Hugo Chavez in denouncing the Bush administration and in creating the Bolivarian Alternative to the US initiative for a Free Trade Area of the Americas.
The reality, however, is that it is not any of the Latin American nations named in the complaint that the US is trying to protect; it is US multinational companies such as Chiquita that have large banana plantations in these countries.
It was these multinationals who were behind the first US complaint to the WTO back in 1995.
Election campaign contributors to both the Republican and Democratic Parties, the multinationals called in their chips with former US President Bill Clinton whose Democratic Party administration lodged the first complaint that began the crippling of the banana industry in CARICOM states. They followed up with the Republican Party administration of George W Bush.
The avarice of these multinationals is astounding.
Latin American banana exports to the EU – largely from the plantations controlled by Chiquita, Dole and Del Monte – already have four-fifths of the market. The remaining paltry one-fifth is shared between the ACP countries.
How much more can they possibly earn from another one-fifth of the market, and have they no care for the small farmers in the ACP markets who barely eke out a living from their hard toil? And what about the US itself? Could the US Trade Representative’s office not seek to persuade the US multinationals not to wound small farmers in the ACP more than the thousand cuts they have already been dealt and from which they are steadily bleeding?
The answer is self-evident.
Reading the text of the US complaint to the WTO, it is quite remarkable how bereft of any embarrassment the USTR’s office can be.
Having refused itself to comply with a WTO Panel ruling that found against the US and in favour of the small Caribbean island, Antigua and Barbuda, over internet gaming, the USTR’s office boldly states in its complaint against the EU banana regime that: “The EC failed to bring its import regime for bananas into compliance with its WTO obligations by the end of the reasonable period of time”. It seems that rules can be conveniently invoked and even more conveniently ignored.
In all of this the ACP States and the poor farmers who are affected by the process are by-standers. On the face of it, they are not the party about whom the complaint is being made. The matter is between the US and the EU – neither of whom will lose anything – and the ACP has no standing in the matter except as its victims.
African, Caribbean and Pacific countries and their small banana farmers would be justified in feeling let down by the US. If there ever was a moral case for claiming that a country has gone “bananas”, this surely must be it.
* * *
Sir Ronald Sanders is a business executive and former Caribbean Ambassador to the World Trade Organization who publishes widely on Small States in the global community. Responses to: ronaldsanders29@hotmail.com
COMMENTARY: U.S. Gone Bananas
By Sir Ronald Sanders
Special to Huntington News Network
In a most remarkable development following closely on the heels of a meeting in Washington between US President George W Bush and heads of government of Caribbean Community (CARICOM) States, the United States has taken an action at the World Trade Organisation (WTO) that will hurt the economies of Caribbean banana exporting countries.
The United States, which does not export bananas, lodged a complaint on June 29, 2007 to the WTO against the banana importing regime of the European Union (EU) saying that it harms exports from Latin American nations such as Ecuador, Honduras, Panama and Nicaragua.
On July 12th, the Dispute Settlement Body of the WTO agreed to set up a panel to examine the US complaint against the EU banana regime.
Undoubtedly, the decision of the Panel will go the route of every other panel that has pronounced on this issue since May 1997: it will instruct the EU to change its banana importing regime to stop any advantage, however miniscule, that African, Caribbean and Pacific (ACP) states enjoy.
This is because WTO rules – formulated largely by the world’s richest nations, especially the US and the EU – say in general terms that the rules apply equally to all however large or small, rich or poor. In this connection, the EU banana importing regime would be wrong to give any advantage, however slight, to small and vulnerable countries.
The EU regime, which has been battered since 1997 because of challenges at the WTO led by the US, does give a little advantage to small Caribbean countries to supply a miniscule amount of the EU’s banana imports. And, this is the point: it is a little advantage for only a very small share of the market. Equity and fairness should dictate that a little advantage in these circumstances is wholly acceptable.
In the process of these challenges, CARICOM banana exporting countries saw the industry decline, foreign exchange earnings decrease and unemployment rise. The lives of simple people were thrown into confusion.
If this most recent request by the US government for a WTO Panel wasn’t’ so seriously harmful to small Caribbean countries, it would be laughable.
Just imagine; the US appears to be defending Nicaragua against the CARICOM states. Yet, it is the Nicaraguan government that has joined Venezuela’s President Hugo Chavez in denouncing the Bush administration and in creating the Bolivarian Alternative to the US initiative for a Free Trade Area of the Americas.
The reality, however, is that it is not any of the Latin American nations named in the complaint that the US is trying to protect; it is US multinational companies such as Chiquita that have large banana plantations in these countries.
It was these multinationals who were behind the first US complaint to the WTO back in 1995.
Election campaign contributors to both the Republican and Democratic Parties, the multinationals called in their chips with former US President Bill Clinton whose Democratic Party administration lodged the first complaint that began the crippling of the banana industry in CARICOM states. They followed up with the Republican Party administration of George W Bush.
The avarice of these multinationals is astounding.
Latin American banana exports to the EU – largely from the plantations controlled by Chiquita, Dole and Del Monte – already have four-fifths of the market. The remaining paltry one-fifth is shared between the ACP countries.
How much more can they possibly earn from another one-fifth of the market, and have they no care for the small farmers in the ACP markets who barely eke out a living from their hard toil? And what about the US itself? Could the US Trade Representative’s office not seek to persuade the US multinationals not to wound small farmers in the ACP more than the thousand cuts they have already been dealt and from which they are steadily bleeding?
The answer is self-evident.
Reading the text of the US complaint to the WTO, it is quite remarkable how bereft of any embarrassment the USTR’s office can be.
Having refused itself to comply with a WTO Panel ruling that found against the US and in favour of the small Caribbean island, Antigua and Barbuda, over internet gaming, the USTR’s office boldly states in its complaint against the EU banana regime that: “The EC failed to bring its import regime for bananas into compliance with its WTO obligations by the end of the reasonable period of time”. It seems that rules can be conveniently invoked and even more conveniently ignored.
In all of this the ACP States and the poor farmers who are affected by the process are by-standers. On the face of it, they are not the party about whom the complaint is being made. The matter is between the US and the EU – neither of whom will lose anything – and the ACP has no standing in the matter except as its victims.
African, Caribbean and Pacific countries and their small banana farmers would be justified in feeling let down by the US. If there ever was a moral case for claiming that a country has gone “bananas”, this surely must be it.
* * *
Sir Ronald Sanders is a business executive and former Caribbean Ambassador to the World Trade Organization who publishes widely on Small States in the global community. Responses to: ronaldsanders29@hotmail.com
