* Deal would end special treatment for Africa and Caribbean
* Lower tariffs for ex-colonies fuelled long-running row
* Deal with Latam could unblock trade talks and cut prices
(Adds background, detail)
By Timothy Heritage and John O'Donnell
STOCKHOLM/BRUSSELS, Nov 18 (Reuters) - European Union trade negotiators are within days of a deal to cut tariffs on bananas imported from outside the African and Caribbean regions, notably from Latin America, EU trade commissioner Catherine Ashton said.
An agreement, which could come as early as this week, would end the world's longest-running trade dispute and bolster the World Trade Organisation, whose Doha negotiations to free up global commerce have at times been held hostage by the row.
"We are in the closing stages of what could be the end of this long dispute," Ashton told Reuters on Wednesday on the sidelines of an EU-Russia summit in Stockholm.
"I think it will be later this week or early next week," she said, commenting on a resolution of the decades-old dispute with exporters in Latin America, who pay higher tariffs than African, Caribbean and Pacific rivals to sell bananas in Europe.
The deal, which should be sealed before the WTO's ministerial conference starting on Nov. 30, would see the European Union steadily cutting tariffs on bananas for suppliers in Latin America and elsewhere.
It is likely to reduce prices for consumers, bolstering competition and strengthening the hand of low-cost Latin American exporters. It will help companies like Chiquita and Dole, U.S. distributors of the region's bananas.
One source close to the matter said, however, that some issues remained to be resolved. "We have to agree what will happen with regard to the Doha round on tropical fruits," he said.
POSITIVE MOMENTUM
Reuters reported earlier this month that a deal on the dispute was emerging.
As part of the deal, the Latin Americans would drop challenges to the EU at the WTO. "We are hopeful that an agreement on bananas will give a momentum for a positive result for world trade," the source said.
Brussels would compensate African, Caribbean and Pacific countries -- mainly former British, French and Portuguese colonies -- that lose preferential access to the EU market.
The terms are likely to resemble an agreement almost reached in July last year on the fringes of a meeting of trade ministers seeking a breakthrough on the Doha talks.
That banana agreement was linked to a broader Doha deal in agriculture and when the July meeting collapsed, the European Union walked away.
Under that arrangement, the EU would have cut the tariff on bananas to $114 a tonne by 2016, from $176, with an initial cut to $148. (Editing by Anthony Barker)