|
|
NEWS
Observations: Peace Treaty Reached in Banana Wars
by A. Turgeman
Military wars go down in the annals of history according to
the various names. The same is true of economic wars, such
as the one recently mentioned on the pages of international
economic journals after the European Union and the United
States announced an agreement that put an end to the
prolonged trade dispute known as the Banana War.
It all began in the year 2000 when the World Trade
Organization permitted the U.S. to impose sanctions on the
import of products from Europe after complaints by the U.S.
that the import of bananas provided the European Union with
an advantage over Latin American banana growers in former
European colonies in Africa and in the Caribbean Islands.
Among the major corporations harmed by the decision was
American company Chiquita, the world's biggest banana
grower. The economic damage was so great that until the
beginning of 2001, Chiquita announced that it had ceased
making payments and that it was considering going to a
bankruptcy court to request protection from its creditors.
It laid the blame on the European Union.
Eventually an international settlement was reached and the
tension abated. According to the agreement, starting July
1st the U.S. will suspend $200 million worth of duties
imposed in 1999 on a variety of goods imported from Europe
and Canada, from French cosmetic products to British flax to
Canadian beef. As Pascal Lamy, trade commissioner of the
European Union, explained, "The agreement is a significant
breakthrough, putting an end to a historical dispute."
An end to the trade conflict between the U.S. and the
European Union could pave the way to a solution to
additional trade disputes between the U.S. and the European
Union, and perhaps--who knows?--to reduced suspicion in
other areas.
|
