EU/US: RELIEF AS WASHINGTON DELAYS BANANA SANCTIONS LIST.

Summary: The European Commission heaved a sigh of relief on December 15 when the United States announced it had delayed the publication of a new list of trade sanctions against the European Union for its banana import regime. But the delay is only until December 21, and there are no indications there will be any breakthrough between the two sides on the issue before that. And the move was dismissed by some as a mere crumb of consolation timed to ensure that the EU-US Summit in Washington on December 18 was not completely overshadowed by the banana brawl. The US also slammed as insincere the initiative by European Trade Commissioner Sir Leon Brittan to ask the World Trade Organisation for a review of the EU's new rules for its banana import regime.

Sir Leon had earlier pleaded with the US not to release the new, refined list of EU exports due be subjected to 100% tariffs in March if the banana fight is not resolved. But the delay appeared only for ceremonial reasons. "It would not be appropriate to publish a retaliation list on the eve of the US-EU Summit", said Jay Ziegler, a spokesman for US Trade Representative's Office, which has been preparing the list of EU products. Even EU officials admitted that the reprieve was purely operational. The issue is over the EU's banana import regime which favours exports from former European colonies in the Caribbean over the Latin American crop. The US won a WTO panel on the issue last year, the EU revised its regime, which is due to come into force on January 1. But Washington says the new rules are still unfair to South American distributors, most of which are owned by US companies. Chiquita Brands International, the main corporate force behind the US threat, says US and Latin American producers are losing ECU 2 billion in banana sales in the EU a year because of the import rules. The US dismisses the EU's changes as cosmetic and does not want to go through the same WTO settlement procedure to check, despite the fact that the EU has agreed to speed up the procedure from 449 days to 170 days. The US has threatened sanctions, to apply from next year, if the EU does not change its rules. The EU has retorted that this is a unilateral threat, and an attempt to bend WTO procedures to meet a US timetable. Despite the delay, the US appeared ever more resolved to carry out its sanctions threat. Officials publicly rubbished Sir Leon's initiative to seek a new WTO panel to resolve the issue. US Ambassador to...