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The EU Supports Adaptation Strategies of Ten Banana Producing Countries

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published
17 February 2012

With an erosion of their preferences to enter into the EU banana market, banana-exporting countries in the African, Caribbean and Pacific Group of States (ACP) need to adapt. 2012 heralds the launch of the programming stage of the Banana Accompanying Measures (BAM), which provides a variety of support to eligible countries.

In 2009 the Geneva Agreement on Trade in Bananas (GATB) ended what had been a long commercial conflict between the banana producing countries of Latin America, the US and the European Union.

From 1993 to 2005 the import of bananas from non-ACP states was subject to quotas and customs duties. ACP states, however, were not subject to customs duties within quota and benefited from reduced customs duties for imports above their quota.

This changed in 2006 when a “tariff only” system was introduced: a "duty-free" regime for the ACP banana exporting countries and a tariff of 176 €/T for the non-ACP countries - essentially the Latin American banana exporting countries.

“With the agreement reached at the World Trade Organisation in Geneva in 2009, the tariff rate will decrease every year until it attains a minimum in 2017 - 114 €/T, or even 75€/T in some cases,” explained Yves Leenaerts of  EuropeAid unit C1, Food Security, Nutrition and Rural Development

“This erosion of preference means that ACP countries have to adapt to the increasing competition and to do so, they will have to make strategic choices,” he said.

 

The GATB included a programme to support the main ACP banana exporting countries to adapt to this challenging situation. The Banana Accompanying Measures (BAM) comes after two previous packages, and is a 190 million euro assistance to ten banana producing ACP countries; seven in the Caribbean (Belize, Jamaica, Dominican Republic, Suriname, St Vincent and the Grenadines, St Lucia and Dominica) and three in Africa (Cameroon, Côte d'Ivoire and Ghana).

“BAM looks at adaptation needs not just in one but at least three directions, addressing economic, social and environmental issues but what is clear is that the BAM are enshrined in the fight against poverty,” said Mr Leenaerts.

Each country has developed a national adaptation strategy that opts for one, two and sometimes all three of these areas of intervention:

Competitiveness of the banana sector, when the export of bananas to the EU market is considered to be economically sustainable by the country, there is a specific effort on the banana value chain because competition is fierce and increasing due to the erosion of preferences.

Diversification of activities, in order to minimise dependency and vulnerability by cultivating other crops or building up other sectors like tourism, for example.

Addressing broader impacts generated by the adaptation process, particularly in local communities and for the most vulnerable groups.

The ten countries experience a variety of production problems.  For example, the banana fungus sigatoka is causing widespread decimation of crops in some areas.  Countries also face climatic and economic concerns. 
 
At the end of January, experts gathered in Accra, Ghana at the Seminar on Food Security and Commodities in Western Africa, with special focus on BAM, to work with delegates from the three African ACP countries on the first stages of programming.

Representing the EuropeAid unit C1 at this event, Mr Leenaerts took a video camera with him in order to share expert opinions and to interview practitioners of the banana sector. He notably interviewed CIRAD economist Denis Loeillet, who reflected on changes and implications in the banana market, and CIRAD agronomist Thierry Lescot, who raised an alert on sigatoka and considered possible solutions.

You can watch these video interviews and find further documentation on the BAM on this page in the capacity4dev.eu Public Group on Agriculture and Rural Development.

Contributors to this collaborative piece:  Yves Leenaerts, Jean-Pierre Halkin, Giorgio Cocchi, Layla El Khadraouiel and Emma Clua.  The views, opinions and the content herein do not represent the official view of the European Commission. Multimedia and collaboration facilitated by EuropeAid's capacity4dev.eu team

DISCLAIMER: This information is provided in the interests of knowledge sharing and capacity development and should not be interpreted as the official view of the European Commission, or any other organisation.

Comments

The ACP ministers made a clear statement on more flexibility in the programs:
http://www.acp.int/sites/acpsec.waw.be/files/ACP25006%2012%20ENG.pdf

Please move:

Ghana looking forward to more EU banana exports
Ghana's Minister of Trade and Industry, Hannah Tetteh, has said that she expects the country's banana exports to the EU to increase over the next few years.
This is as a result of the EU removing the quota and tariff that was imposed on the country, after the signing of an Interim Economic Partnership Agreement.
Banana production in Ghana has been increasing, largely as a result of foreign investment in the country and the sector specifically.
Currently, Ghana exports over 50,000 metric tonnes of banana annually to the EU, which is a jump from the 4000 metric tonnes the country was exporting about six years ago.
Ms Tetteh acknowledged the challenge posed to Ghana's banana industry by Latin American countries. She said that Ghana's growers needed to be able to produce at lower costs in order to be able to compete internationally.
The funds for improvements such as this are to come from the BAM - Banana Accompanying Measures, EU funds to assist banana producing countries with the liberalisation of the industry on the global stage.
The EU Ambassador to Ghana, Claude Maerten, said the trust of the EU trade and economic partnership with Ghana was to improve the lives of the citizen.
Source: ghana.gov.gh 04/07/12

Be aware that the EU was never able to provide any procedural rules & regs for the BAM. In July '12, it now seems they will be implementing the 'Call for Proposals' methodology - 75% EU, 25% partner donor - a system that has never been used in EU funding on bananas before. Surely they should have informed all parties prior to acceptance of this programme?
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