By Anne-France White - 19th September 2006
European banana growers will receive €40m more per year in EU funding following a proposal adopted today by the European commission.
The move, which is part of the reform of the EU’s internal banana regime, means EU money for growers will go from €240m to €280m per year starting in January 2007.
Spain will get 50.4 per cent of the funding and France 46.1 per cent, with 3.1 per cent going to Portugal and 0.4 per cent to Greece.
96 per cent of all EU bananas are produced in the so-called “outermost” regions of Guadeloupe, Martinique, the Canary Islands, the Azores and Madeira; marginal quantities are also produced in Greece and continental Portugal.
As part of the new reform, funding for the outermost growers will also switch from the current aid scheme to the “Posei” programme, which specifically funds agriculture in the EU’s remote regions.
The commission says that under this new envelope, growers will have to “increase their market orientation” compared to the old system, where they were automatically compensated for drops in prices.
According to farm commissioner Mariann Fischer Boel, the reform will be “a splendid basis for continuing banana production in the EU’s remote areas”.
While EU-grown bananas account for just 16 per cent of the total EU supply, they employ a large part of the workforce in place like Martinique and the Canary Islands.
In Madrid, Spain's Agriculture Minister Elena Espinosa welcomed the EU proposal, saying bananas were a key engine for the economy of the Canaries.
But the commission’s decision to boost funding for its banana producers is not uncontroversial.
Fischer Boel today alluded to the long and arduous negotiations which have led to the deal: “I never in my life expected bananas to be so difficult,” she said.
Critics have accused the EU of subsidizing an inefficient banana industry to the detriment of growers in poorer countries in Latin America and Africa.
Latin America's producers are unhappy with the €176 per tonne banana tariff the EU introduced in January 2006 for mostly Latin American producers.
Ecuador and Colombia - who argue that the tariff gives preferential treatment to European and African growers - are expected to bring the issue to the WTO in the coming weeks.
This could mark a possible repeat of the banana wars which have plagued EU-Latin America relations in recent years.
The EU is the world's biggest banana market – 68 per cent of the 4.6M tons of bananas that Europeans eat every year come from Latin America, with a further 17 per cent from Africa and Caribbean nations.
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