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EC quota drives Germans bananas

EC quota drives Germans bananas AS THE world's biggest per capita consumers of bananas, the Germans are understandably angered by an European Community (EC) proposal to restrict imports of the fruit from Latin America.

The EC proposal, which is to come into effect July 1, would tax banana imports from Latin America at the rate of $117 per tonne for the first 2 million tonnes and then at $995 per tonne. The quota is intended to protect producers in the ACP region -- Africa, the Caribbean and Pacific countries -- against Latin American bananas, which are cheaper because they are produced mostly by either huge corporations or large landowners.

However, these large producers tend to exploit workers, most of whom are usually permanently indebted to their employers. In most African countries, on the contrary, bananas are produced by small farmers, whose cost of production is high.

EC imports 2.6 million tonnes of bananas a year from the Latin American countries of Honduras, Ecuador, Costa Rica, Colombia, Guatemala, Panama, Nicaragua, Venezuela and the Dominican Republic. Germany alone imports 1.5 million tonnes of bananas a year, of which 1.35 million tonnes is from Latin America. Cheap and easily available bananas symbolised for erstwhile East Germans the beacon of hope cast by West Germany's free-market economy and stories abound of how bananas sold furiously in the days after the German reunification.

The situation, however, is likely to change as the EC quotas will raise banana prices by one-third. This, warns German foreign minister Klaus Kinkel, could shatter the economies of some Latin American countries, which are dependent heavily on banana exports. Germany, Belgium, Netherlands and Luxembourg have decided to oppose jointly the import restrictions and the Germans also intend to lodge a formal complaint with the International Court of Justice in The Hague.

German fruit traders and some politicians warn that mass retrenchment would result in Latin America because of the banana import quotas imposed by the EC agriculture ministers might force people into the cocaine trade to earn their livelihood. In Colombia, they predicted at least 173,000 people stand to lose their jobs and 12 per cent of banana plantations in the country would be destroyed.

However, discounting German worries, EC farm commissioner Rene Steichen noted the agreement would stabilise prices. The quota, he assured, could be revised upward if necessary.

But one angry letter-writer noted in the International Herald Tribune: "If the plight of the Latin American farm labourer enables Europeans to buy bananas dirt cheap, then Europeans are using the denial of Latin American labourers' basic rights to subsidise their consumption. And, subsidies are definitely not what the free market is about."