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The people of Europe peel back more than 2.5 billion tonnes of bananas every year. Now, this love of bananas has turned to war. Trade war. The "banana wars" is the culmination of a six-year trade quarrel between the US and the EU. The US complained that an EU scheme giving banana producers from former colonies in the Caribbean special access to European markets broke free trade rules. Only seven per cent of Europe's bananas come from the Caribbean, US multinationals which control the Latin American banana crop hold three-quarters of the EU market and the US itself does not export bananas to Europe. Despite this, the US filed a complaint against the EU with the World Trade Organisation (WTO) and, in 1997, won. The EU was instructed to alter its rules.
If the US doesn't export bananas direct to Europe why are they so angry?
Whether Democrat or Republican, American administrations have long championed an ideological commitment to free trade. But the "banana wars" are murkier than that clear principle. The US government is concerned about its economy. The US trade deficit is at a nine-year high. Its current account deficit could reach $300 billion in 1999, surpassing previous record levels in 1986/7. The government feels it can't afford to allow any European protectionism, no matter how petty, to disadvantage its troubled trading balance. The US government is also pressurised by powerful US-based multinationals which dominate the Latin American banana industry. The Clinton administration took the "banana wars" to the WTO within 24 hours of Chiquita Brands, a powerful, previously Republican-supporting banana multinational, making a $500,000 donation to the Democratic Party.
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