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Bananas

rose to ask Her Majesty’s Government whether the new European regime for the import of bananas is in the best interests of the United Kingdom. The noble Viscount said: My Lords, we move to the vexed question of bananas. I am extremely grateful to the noble Lord, Lord Grocott, the government Chief Whip, for allowing me time for this debate in a crowded programme; and to the noble Lord, Lord Bach for making himself available to answer it. As this is an Unstarred Question, I have no right of reply, so I thank the various noble Lords who will speak in this short debate. Not all of them are quite here at the moment because it is taking place rather earlier than expected, but no doubt they will turn up. Some of the key figures are here, however. I have taken a few soundings in advance, and know that all the speakers will disagree entirely with what I am going to say. That is not an unusual state of affairs. I have been interested in the issue of bananas for a long time, and have always irritated the Front Bench of the day about it. I am returning to an issue which I used to pursue in the 1980s and 1990s. The dispute over the tariff for banana imports into the EU has not yet really been resolved. It goes back 13 years to the early 1990s, when the EU decided to regulate the market for imports. This regulation comprised a complex system of quotas, tariffs and licences designed to protect former colonies in Africa, the Caribbean and the Pacific—known as the ACP territories—against the Latin American bananas coming from what the Americans call the most favoured nations, or MFNs, referring to the Latin American producers in central and south America. Following a great deal of agitation from Latin America, led by Ecuador for south America and Costa Rica for central America, the WTO decided, quite rightly, that the EU system went against the principles of free trade. As part of the solution, it was agreed in 2001 that a tariff-only system of import controls should be put into effect from 1 January this year. Meanwhile, various interim measures were introduced which allowed the ACP countries to continue with a zero tariff for 750,000 tonnes per annum, and for Latin American bananas—which account for 60 per cent of EU imports—to pay €230 per tonne, as against the €75 originally agreed. Not surprisingly, as I am sure noble Lords will appreciate, the Latin American countries objected and, last year, a series of arbitrations ensued which tended to agree with the Latin American view. This has so far merely had the effect of reducing the Latin American tariff to €176 per tonne, while maintaining the zero tariff for the ACP quota. I have to admit that that does not seem fair, and I do not see how anybody could argue that it is. At the WTO summit in Hong Kong last December, the EU appointed the Norwegian ambassador to use his best endeavours to resolve the problem. There, as far as I know, the matter more or less rests, although I believe that there have been various interim measures in an attempt to protect the ACP countries’ trade. So, once again, we have the EU, principally led by France, operating in a protectionist mode against the interests of consumers in general and, of course, Latin American producers in particular. ““Free trade”” means—or should mean—what it says. Indeed, the main purpose of the World Trade Organisation is to ensure that this happens. Unfortunately, so far it has not. The case for the ACP subsidy is usually based on the notion that if the small islands cannot produce bananas competitively they will turn to drugs. This is a specious and ridiculous argument at any time, since the production and illegal trading of drugs will always be infinitely more profitable than almost any other crop in the world. That is not a substitute for bananas. It would be the wrong kind of substitute. I am sure that there are other things that can be done in the Caribbean if necessary to support their industries and people. That is up to the individual countries concerned, but it should not be imposed on the world in general. My Question is to ask the Minister where we now stand, and to seek his confirmation that UK interests are best served by importing the best quality bananas from the most efficient source.