The 2005 WTO Arbitration and the New EU Import Regime for Bananas : A Cut Too Far?

In 2001 an agreement was reached at the WTO for the EU to introduce a tariff-only regime which would result in at least maintaining total market access for MFN banana suppliers. The analysis shows that, contrary to the WTO 2005 ruling, the import regime proposed by the EU in the second step of the arbitration would have satisfied the requirement. The regime introduced on 1 January 2006 is expected to yield in 2007 MFN imports 400,000 t above the level that would have occurred under the previous regime. In the longer run, MFN countries will see their exports expand, while the opposite would have happened had the new regime not been introduced