A trade war is on the cards over banana tariffs following threats by Colombia to impose import sanctions on the EU.

The South American country, which supplies 10% of UK bananas, wants compensation for the loss of millions of euros after eastern European states joined the EU in May 2004 and raised import taxes on bananas to conform with Brussels rules.

The warning on the WTO web site did not identify the EU products that would be hit. It said that efforts to negotiate direct cash compensation - as Brussels did with other major trading partners that lost out in the EU's expansion - had so far met no success.