China cuts tariff on banana

China cuts tariff on banana

MANILA (Dow Jones): Chinese Premier Zhu Rongji said Saturday that China will cut its tariff on Philippine bananas as a first step toward reducing the Philippine trade deficit with China.

In a meeting with Philippine businessmen, Zhu also promised assistance to help the Philippines boost agricultural production, particularly rice output.

Last year, China enjoyed a $1 billion trade surplus with the Philippines, whose biggest export to China is bananas. The Philippines supplies 30 percent of China's banana requirements.

Zhu, who met Philippine President Joseph Estrada Friday, said he was considering Manila's request to bring down China's tariff on Philippine bananas to $250 a metric ton from the present $330.

He said it was unlikely the tariff would be brought down that far, because such a move could spur a similar demand from Ecuador, another big banana exporter to China. Bananas imported from Ecuador into China are levied a tariff of $430 a ton, Zhu said.