The settlement, which national lawmakers are expected to ratify within four months, trade officials say, means less-expensive bananas for Europeans, more profit for U.S. fruit companies and lower revenue for some former EU colonies. It ends a 16-year-old trade dispute over access to the EU's $6.7 billion banana market, the world's largest.
Who knew the EU had the world's largest banana market? I hate bananas so I am akin to Switzerland in this whole Banana War. But this may interest investors in the reviled yellow fruit:
Banana imports from the former colonies will fall 14%, costing them $40 million a year, and imports from other countries will increase 17%, according to a study by the Geneva-based International Centre for Sustainable Trade and Development. Banana prices in Europe will fall 12%, the study added.
Ed Loyd, a Chiquita spokesman, said the agreement would save Chiquita about $12 million a year for every €10 reduction in the tariff. He said the ruling would benefit the Cincinnati company more than most of its competitors because it is the market leader in Europe and sources nearly all of the bananas it sells in Europe from Latin America.
Of course you would think that the so-called "Banana Industrial Complex" would make out at the expense of these African banana nations. In any case it boosted Chiquita stock (CQB) a cool 3.9% and might make it go higher depending on what percentage of the European market will be eating cheaper South American bananas rather than already fairly cheap African bananas.
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