Del Monte Supports European Banana Tariffs

NEW YORK - Nov 30/05 - SNS -- Banana market participants are not taking the same view of the European Union's decision to move to a tariff based system to control imports.

The change is opposed by Chiquita Brands International, Inc., but supported by Fresh Del Monte Produce. The European Union set a new import tariff of 176 euros per metric ton (MT) to apply from 1 January 2006 to bananas imported from countries – mainly in Latin America - enjoying Most Favoured Nation status.

The new import regime will also include a duty-free annual import quota of 775,000 MT for ACP bananas, also to apply from 1 January 2006.

Fernando Aguirre, chairman and chief executive officer at Chiquita, argues the change "will be bad for banana producers and will introduce a number of clear World Trade Organization violations that have previously been condemned.

"If a revision of this regime is ratified, the €176 MT tariff, which is more than double the current tariff of €75, would impose an additional $375 million tax burden on the European banana trade each year and would increase tariff costs on bananas imported by Chiquita by approximately $110 million per year," Aguirre said.

Mohammad Abu-Ghazaleh, Fresh Del Monte's Chairman and Chief Executive Officer, counters, "We have always maintained that the tariff only system is the only system that will correct the injustice suffered for years by Fresh Del Monte as well as other supplying companies under the current quota and licenses system.

"Fresh Del Monte has consistently supported the WTO's finding that the current quota system is iniquitous in many respects; having lead to trading in licenses, flouting trade and most importantly, it has penalized companies such as Fresh Del Monte by forcing them to buy licenses from middlemen and/or competitors in order to sell bananas in the EU. Beginning on January first, 2006, we will see free access and fair competition for supplying countries and companies."