BRITAIN'S shoppers are being urged to keep faith with fair trade Caribbean banana growers as the European Union and Latin America prepare to declare a ceasefire in the 16-year “banana wars,” one of the world's longest-running trade disputes.

Banana prices should fall as a result of the deal, as Brussels cuts the import taxes it charges Latin American growers to sell their more cheaply produced fruit in the European market.

But Alistair Smith, international co-ordinator of the co-operative Banana Link, warned the impact of the agreement would be “devastating” for small farmers in the Caribbean Windward Islands, unless British consumers — their major market — stuck with fair trade fruit.

“The costs of the end of the banana industry in the Windward Islands would be nothing short of devastating — it's the biggest single sector in the economy, it's the largest employer,” he said.

Cathy Ashton, the EU trade commissioner, said the warring parties in the banana dispute were very close to an agreement. “We are not there yet but we are now in the final stages of negotiations in Geneva ... [which] I hope will actually draw it to a close and demonstrate that we are able to deal with these problems eventually. “I think it will be later this week or early next week because I want to make sure that everything is in place,” she said.

Proposals on the table would lower the import tariffs Europe charges on Latin American bananas, from EUR176 a tonne to EUR148, and then gradually to EUR114 over the following seven years.

That would almost eliminate the special “preferences” the EU currently gives to banana producers in Africa, the Caribbean and the Pacific — known as the ACP countries — many of which are former colonies.

As a result of the deal, banana prices in Europe's shops should fall by up to 12 per cent by 2016, as imports from cheaper Latin American producers surge, according to a recent study for the Geneva-based International Centre for Trade and Sustainable Development. On Wednesday, shares in Fyffes, a major banana importer, jumped by more than 6 per cent on the prospect of rising imports.

Latin American banana-growing countries, such as Ecuador and Costa Rica, have long argued that the preferential treatment given to the African and Caribbean growers constituted an unfair advantage.

The World Trade Organisation, which polices the international market, agreed that the EU's banana regime broke its rules, but it has taken many years for a final agreement to be reached, as banana-producing countries, including the Windward Islands, Ghana and Cameroon, argued that many thousands of livelihoods would face a serious threat if they lost their special access to the European market.

— The Guardian, London