GLOBAL ISSUES FOR BREAKFAST: THE BANANA INDUSTRY AND ITS PROBLEMS FAQ (COHEN MIX)

By | June 12, 2009 | archive, textbook

Bananas are just a fruit, how are they considered a global issue?

Although bananas may only look like a fruit, they represent a wide variety of environmental, economic, social, and political problems. The banana trade symbolizes economic imperialism, injustices in the global trade market, and the globalization of the agricultural economy [1]. Bananas are also number four on the list of staple crops in the world and one of the biggest profit makers in supermarkets, making them critical for economic and global food security [2]. As one of the first tropical fruits to be exported, bananas were a cheap way to bring “the tropics” to North America and Europe [3]. Bananas have become such a common, inexpensive grocery item that we often forget where they come from and how they got here.

Bananas are cheap for a reason, having adopted unfair work trends (such as low wages and long hours) which are found in many global industries. Consequently, the lives of workers in developing countries have been sacrificed in order to keep bananas affordable [4]. Employees face shocking working conditions and extremely low wages. Furthermore, the large transnational banana companies that control wages, prices in the global banana trade, represent a real threat to small farmers [5]. In fact, economic wars have been fought over bananas, and they are the continuing cause of economic and political problems. They are also one of the most environmentally harmful agricultural industries [6]. Produced on multiple continents and consumed around the world, who knew that this popular, healthy fruit could cause such massive destruction?

How did bananas become such massive problem?

The history of the banana industry is long, dark, and complex. Economic and political problems and the mistreatment of workers date back to the late 1800s in Honduras, when the first railway system that connected Central America with North America was built. Bananas are a very difficult fruit to transport and keep fresh, and the railways allowed the export of bananas [7]. American businessmen very quickly bought large plots of land and shipped bananas to the United States, and a very prominent American corporation called the United Fruit Company (UFC) controlled the trade. UFC soon owned much of the best agricultural land in countries such as Guatemala, Honduras, and Nicaragua, and the banana industry grew exponentially between 1900 and 1930 [8].

At this time the term “banana empire” or “banana republic” emerged, appropriately named because UFC held incredible economic and political power in these countries [9]. For example, in 1930 UFC owned 63 percent of the 103 million bunches of bananas exported from Latin America [10]. The extent of their power and control was possible because Central America, a continent which historically had been economically weak and politically divided, was powerless against the large corporation. UFC thrived on the lack of unity, poverty, and corrupt governments [11]. Businessmen were able to manipulate governments to get the best land, and vertically integrate the industry to control all aspects of production and keep prices low [12] . Over the next few decades, Ecuador and many Caribbean islands joined the banana trade, while other transnational corporations emerged. Although these new producing countries greatly profited from the enormous amounts of exports, production of other industries declined, leading to an unhealthy dependance on the banana.

The banana industry in Latin America peaked in 1930; thereafter, the transnational corporations slowly lost much of their political influence in the banana republics, due to a number of factors such as plant disease, the great depression, and labor issues [13]. However they were still keen to keep a presence in Latin America, and in the 1950s, these transnational fruit corporations intervened when the Guatemalan government attempted to take back land from the corporations to distribute it among the peasants. The American government, backed by the transnational fruit corporations, overthrew the democratically elected government, and helped elect a president who favored their economic interests [14].

Later, in the 1990s, economic wars began between Britain, the United States, Latin America, and the Caribbean [15]. These “wars” which were fought over tariffs, import licenses, and the question of free trade, continue until today. Many complicated agreements exist, and determine which countries may export bananas to which markets. This is a major topic of debate within the World Trade Organization [16]. However, the biggest problem is that developed countries are continually searching for the cheapest bananas, and are willing to ignore the abominable treatment of workers and the worst environmental practices. Many countries around the world are now involved in this trade, and responsible for its political, economic, social, and environmental problems.

Where and how are bananas produced?

Bananas are produced in tropical climates around the world, from Mexico to Brazil, from to the Philippines to Madagascar. For the most part, bananas that are grown for export are grown in large scale plantations up to 100 square kilometers [17]. There are over 300 species of bananas, yet only one is grown for international trade: the Cavendish [18].

Banana plants take ten months to grow from a sapling to a fruit bearing tree [19]. The fruit is harvested four to five months later, while they are still green, in large bunches that can weigh up to 80 kilograms [20]. They are then taken to a packing site where they are separated, washed, wrapped and boxed. High esthetic standards must be met, and only “perfect” looking bananas are considered acceptable; any that are blemished are thrown away. The United Nations Agriculture Organization estimates that 30 to 40 percent of bananas are discarded based solely on appearance [21].

The enormous boxes containing the bananas are shipped around the world on freighters with intensive refrigerated units where the bananas are stored in order to prevent pre-mature ripening. It is estimated that this type of shipping accounts of five percent of world carbon dioxide emissions [22]. Once the fruit arrives in the country of destination, they are artificially ripened in warehouses by spraying them with a chemical called ethylene in carefully controlled temperatures. They are then transferred (usually by road or rail transportation) to retailers and wholesalers [23] . In all, the entire process produces large amounts of carbon dioxide emissions and waste.

Which companies export bananas?

The banana plantations and the banana trade are owned and controlled by transnational companies. In fact, only five transnational companies, Chiquita, Dole (both American based), Del Monte (Chilean based), Fyffes (Ireland based), and Noboa, known as the “Bonita” brand, (Ecuadorian based) own over 90 percent of internationally traded bananas [24]. In Latin America the main exporters are (in descending order): Ecuador, Costa Rica, Colombia, Guatemala, Honduras, Panama, Brazil, Mexico, Nicaragua, Venezuela, and Peru. Bananas from these countries are called “dollar bananas” because they are exported to North America and produced by American companies. The Ivory Coast, Cameroon, St. Lucia, Jamaica, Belize, St. Vincent and the Grenadines, Dominica, Suriname, Grenada, Somalia, Cape Verde, and Madagascar are called ACP bananas (African Caribbean and Pacific). These countries produce the bananas which are exported to Europe [25].

Colonial histories influence trade agreements and partly determine who exports to whom. For example, in North America we do not consume bananas from Belize or Suriname, which were former European colonies. Transnational companies will export from where it is cheapest and easiest. Although certain countries produce just as many bananas as others, for example Brazil produces just as many or more bananas than Ecuador, due to government policies and trade agreements, production and export of Brazilian bananas is more costly. Therefore, most Brazilian bananas are not exported and we consume bananas from Ecuador, a country where it is cheap to produce.

What are these so called “banana wars”?

The banana wars were a series of trade disputes between the USA and the European Union. The origins of the debate date back to the 1940s, although the most heated wars took place between 1993 and 2001 [26]. The US and the EU were the biggest players, although many other countries were also affected [27]. Free trade and tariffs were some of the fundamental reasons on which the banana wars were fought. The EU favors trade preferences, higher tariffs, and import licenses, where as the US prefers lower tariffs and free trade to encourage competitiveness and the constant search for lower prices [28].

The American approach leads to large scale plantations such as those in Latin America. Caribbean bananas, for example, are grown on very small plantations, and it is difficult to produce them cheaply in large quantities. Several important debate issues were as follows: the UK, who was then president of the European Union, were very much interested in protecting the banana industry in the Caribbean and wanted to foster trade with their former colonies [29].

Furthermore, in the early 1990s a banana import policy (the Lomé Convention) was created, which restricted the amount of Latin American bananas imported to Europe. This infuriated the United States because they led the banana trade in Latin America and were afraid of losing their market [30]. The World Trade Organization got involved in the disputes after the EU finalized and signed the Lomé Convention with its banana trade partners in 1993. This convention allowed European Union members to import from all ACP exporters (previously European countries only imported from former colonies). This accord also allowed European countries to favor ACP bananas. This greatly concerned the WTO, who favored more free trade [31]. The disputes cooled off in November 2001 when negotiations began in order to find a new trade regime that would please both parties and these negotiations continue until today [32].

These wars demonstrated the globalization of the agricultural industry, the importance that a single trade item holds, and most notably, it showed the power of the American corporation and its ability to influence trade policies [33].

What are some of the social issues associated with banana production?

The biggest problem with the banana trade is that there is currently a “race to the bottom”. This competition for the lowest prices is led by supermarkets, who are constantly looking to buy the cheapest bananas [34]. This comes at a great cost to plantation workers because they, in turn, are paid lower wages. For every dollar spent on bananas at the supermarket, eleven cents or less goes to the plantation. More often than not plantations receive only five cents from every dollar, which is then divided up, and as a result, workers are being paid shockingly low wages [35]. The actual wage workers receive depends on the country; for example, in Nicaragua workers are paid roughly one and a half US dollars for a day’s work. In Ecuador they may receive as much as five to eight US dollars; however, even this is not enough to pay for basic necessities [36].

Workers are forced to stay ten to twelve hours, even though they are only paid for eight. Transnational fruit corporations often do not respect labour codes nor workers rights, but workers have little way to protest because they are often prohibited for joining trade unions [37]. The work itself is physically demanding and workers may have to carry extremely heavy loads or stand for ten hours straight with their unprotected hands dipped in a bath of chemicals (in order to wash the bananas) [38]. Bananas are grown using large amounts of toxic pesticides, and cancer or even death from exposure is a concern. Indeed, many of these chemicals are prohibited in North America and Europe, but are still used on banana plantations [39].

Accidents are also a common occurrence and there is no medical treatment or compensation for workers [40]. Furthermore, plantation work offers very little job security. Laborers often migrate to find work, and then are only given a three to six month contract [41]. Although housing is provided on the plantation, conditions are usually appalling. Child labor is common place, and a non governmental organization in Ecuador found that children as young as eight were being recruited to work [42]. Gender discrimination also exists: women face sexual harassment, and men often make three to four times more for similar work. Lastly, indigenous populations are driven out from their land in order to create space for the plantations [43].

The worst problem, however, is that the banana republics have become so dependent on the banana trade that if all of a sudden importers stop buying, these countries will immediately face severe economic shock, and the entire country will suffer. This was seen with the case of Jamaica, who traditionally exported to the United Kingdom. When disease and other conditions harmed Jamaican banana production and made it more costly, the UK turned to Central America (where it was cheaper) for its banana imports, and the Jamaican economy greatly suffered [44].

How is the banana industry affecting the environment?

The banana is a very ecologically demanding species. It pollutes the air, water, and land. Land is cleared in order to make space for banana plantations, but because banana trees shed no natural leaf litter to feed the soil, it depletes very quickly. Plantations are therefore forced to expand, and the problems associated with banana production grow. Deforestation and unhealthy soil cause erosion, and the runoff causes frequent flooding and damage from sedimentation [45]. In a 1997 study done off the coast of Costa Rica, it was discovered that 60 percent of the coral reefs in Cahuita National Park had been severely damaged due to runoff from coastal banana plantations [46].

Heavy pesticide use also causes problems. In an attempt to meet the demand for aesthetically perfect bananas, over 400 types of agrochemicals are used. In fact, more chemicals are used during banana production than any other crop with the exception of cotton [47]. These chemicals can lead to sterility, cancer, and death. Insects become resistant to many of these pesticides, therefore stronger, more toxic chemicals are needed. These chemicals affect mammals, birds, and plants, and the bio-diversity of the area quickly disappears. Pesticides also destroy the possibility for pioneer plant species to grow, and the area dies.

Furthermore, bananas are grown as a mono-culture, meaning that all the bananas on a plantation are genetically identical. Although this makes crops easy to manage, these bananas face an increased risk of being wiped out by a single type of pest, fungi or disease [48]. In order to prevent this from happening even more chemicals are used. It is estimated that 30 kilograms of pesticides are used per hectare per year on a banana plantation, whereas only 2.7 kilograms are used for the average European cereal crop [49].

Lastly, according to the World Wildlife Fund the banana industry produces more waste than any other agricultural sector in the developing world [50]. It is estimated that for every one ton of bananas produced, there are two tons of waste [51]. This waste includes industrial plastic bags that cover the bananas during growing stages, the string that ties up these bags, and the containers the bananas are carried in. Banana trees only bear fruit once in their lifetime, therefore once bananas are cultivated, the tree is no longer useful, and goes to waste [52]. Also, those 30 to 40 percent of bananas that do not meet aesthetic standards are thrown away. Most of this waste is poisoned with toxic pesticides and harms the environment [53]. Although international environmental standards have been created in order to reduce these problems, many companies fail to follow them [54].

What is being done to change banana practices?

Although Chiquita and other companies have been making efforts to improve practices, there are still many problems with the banana industry [55] . As a result, there are a number of NGOs working towards improving the banana industry. An important British NGO called Banana Link (www.bananalink.org.uk) is a great source of information on the industry. With their partners, they are looking to reverse the “race to the bottom” [56].

With the help of a number of different NGOs, international banana conferences have been held between producing and exporting countries in order to acknowledge and analyze the problems with the banana trade and to look for feasible solutions [57]. These conferences brought together governments, companies, stake holders, and researchers. So far there have been two conferences in Brussels, one in 1998 and the other in 2005 [58]. After the first conference, an international banana charter was created, which outlined an action plan for improving social conditions.

Unfortunately, the charter was not observed, and if anything, working conditions actually worsened on account of the power recently acquired by large global retailers, who refused to cooperate and follow the charter. They actually lowered banana prices, which in turn, forced smaller retailers to lower their prices as well, and less money reached the plantations. A participant declaration was created after the second banana conference. Most importantly, this declaration attempted to regulate supermarket prices and enforce health, safety and environmental practices on the plantations themselves [59].

One of the important NGOs involved in these conferences (and the banana trade in general) is COLISBA (Coordinadora Latinoamericano de Sindicatos Bananeros). This group coordinates trade unions across eight Latin American countries. In general, workers are not permitted to join trade unions, and this organization fights for the creation of unions and workers’ rights. Other important organizations include EUROBAN, IUF (International Union of Food, Agriculture, Hotel, Restaurant, Catering, Tobacco, and Allied Workers’ Association), and US/LEAP (US labor and education in the Americas project). These three organizations also fight for workers’ rights, as well as rally against unsustainable environmental practices, and demand fair trade. The International Network for the Improvement of the Banana and Plantain (INIBAP) is one of the few organizations that does scientific research in order to improve banana production for small farmers [60].

The World Trade Organization rules currently state that importing countries may not refuse to buy bananas based on the way exporters treat their workers or oversee environmental practices [61]. The biggest challenge these NGOs face is changing the WTO’s rules so that importing countries can no longer buy from countries that do not follow international standards which were declared at the banana conferences.

What can I, as an individual, do to help?

The power to change the banana trade is truly in the hands of the consumer. One can purchase fair trade bananas, which are grown on plantations where workers are treated in a just manner and are paid higher wages. If consumers buy these fair trade bananas, demand for them will increase. Theoretically demand for other, non fair trade bananas will decrease and working conditions will improve.

Organic bananas are another feasible solution. Although workers on organic plantations may still face injustices, the environmental practices are considerably more sustainable, the crops are not always grown as a mono-culture, and less environmental damage is being done [62]. Unfortunately, organics currently only account for one to two percent of global banana exports [63].

It is important to remember that the banana trade affects the entire world, and it is up to us, as banana consumers in developed world, to help the lives of workers in the developing world, to end environmental damage, and to encourage fair trade.

FOOTNOTES
1. “The Banana Trade,” Banana Link, link.
2. “The Banana Trade,” Banana Link and Chapman, Peter, Bananas: How the United Fruit Company Shaped the World, (Great Britain: Canongate Books Ltd. 2007) 20.
3. Hamer, Ed. “Bananas.” The Ecologist, September 2007, 24.
4. “The Banana Trade,” Banana Link.
5. Hamer 24.
6. Shah, Anup. “Bananas,” Global Issues, link
7. Wiley, James, The Banana: Empires, Trade Wars, and Globalization (Lincoln: University of Nebraska Press, 2008) 6.
8. Wiley 29
9. Chapman 68
10. Scott Jenkins, Virgina, Bananas: an American History (Washington DC: Smithsonian Institution Press, 2000) 20.
11. Wiley 31
12. Wiley 18
13. Wiley 35
14. Chapman 123
15. Myers 23
16. Myers x
17. “Trade Policy,” Banana Link, link.
18. Hamer 24
19. Scott Jenkins 5
20. Hamer 27
21. Hamer 27
22. Hamer 27
23. Hamer 27
24. “Trade Policy,” Banana Link.
25. “Trade Policy,” Banana Link.
26. Wiley 164
27. Myers 1.
28. Wiley 181
29. Myers 3
30. Wiley xix
31. Alter, Karen J. and Sophie Meunier “Nested and overlapping regimes in the
transatlantic banana trade dispute” Journal of European Public Policy. April 2006. 368
32. Myers 178
33. Myers 1 and Wiley xix
34. “Social and Environmental Impacts,” Banana Link, link
35. Hamer 26
36. Hamer 26
37. “Social and Environmental Impacts,” Banana Link.
38. “Social and Environmental Impacts,” Banana Link.
39. Hamer 26
40. “Social and Environmental Impacts,” Banana Link.
41. “Social and Environmental Impacts,” Banana Link.
42. “Social and Environmental Impacts,” Banana Link.
43. “Social and Environmental Impacts,” Banana Link.
44. Myers 24
45. Hamer 25
46. Hamer 25
47. “Social and Environmental Impacts,” Banana Link.
48. “Banana Republics take up ecotourism,” Earth Explorer, 1995 eLibrary, Proquest CSA. Vancouver Public Library, link. (March 15 2009).
49. Hamer 26
50. Hamer 26
51. Hamer 26
52. Scott Jenkins 5
53. Hamer 26
54. “Social and Environmental Impacts,” Banana Link.
55. Jackson, Rachel, “Green Bananas,” E Magazine, January/February 2007, eLibrary. Proquest CSA. Vancouver Public Library. link. March 31 2009.
56. “The Banana Trade,” Banana Link.
57. “Alternatives for the Future,” Banana Link, link.
58. “Alternatives for the Future,” Banana Link.
59. “Alternatives for the Future,” Banana Link.
60. “Alternatives for the Future,” Banana Link.
61. “Alternatives for the Future,” Banana Link.
62. “Alternatives for the Future,” Banana Link.
63. “Alternatives for the Future,” Banana Link.

About Rebecca Cohen

Rebecca has just completed her second year in the faculty of Arts at UBC. Two years ago she spent a year in several different banana producing countries in Latin America, inspiring her to write this piece on the banana industry.