The changes included tightening the requirements for obtaining banana licences, in order to deter speculators, and refining the definition of would-be entrants to the EU banana market. The United States and Ecuador had argued that the previous EU banana regime had unfairly benefited producers and exporters from former European colonies in the ACP group, because it reserved a part of the European market solely for ACP imports. These sanctions were also supported by the Latin American banana producing states of Colombia, Costa Rica, Guatemala, Honduras, Mexico, Nicaragua, Panama and Venezuela. Developing countries have long argued that they could not get a fair deal at the WTO, as poorer countries lacked technical know-how and financial resources on how to make the trading body work for them. The joint Ecuador-EU statement issued Monday said the understanding reached over the weekend ''is also a clear victory for the WTO as it helped resolve a difficult dispute between developing and developed countries''.
Bananas are Ecuador's second largest source of foreign exchange, after oil.
It abolishes the EU's import break down on a country quota basis, increases the import volumes from Latin America by 100,000 tonnes, and improves market access to both traditional and non-traditional importers from Ecuador. The new regime will hold for a transitional period through to the establishment of a tariff-only system by 2006. The European Commission said it would also initiate the necessary procedures to propose to its member states an adjustment of the quantities in the various quotas, in order to expand access for Latin American bananas and to secure a market share for a specific quantity of bananas of ACP origin. Ecuador has pledged to work actively to secure acceptance of the EU's request for the necessary WTO authorisation. In order to enter into force, the agreement must be endorsed by all the 15 EU member states and the European Parliament.