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February 2006

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Belize and Bananas

By Alexandra Freedman
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February 2006
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O n January 1, 2006 a small banana export market in the sparsely populated country of Belize suffered an enormous blow. After 11 years of negotiations in WTO courts, U.S. and Latin American banana exporters succeeded in chiseling away ACP (African, Caribbean and Pacific) market protections. ACP status was created in the late 1960s by six Western European nations as an economic safety net for their former colonies. This safety net, now an EU-wide program, consists of aid for development projects and a tariff free quota import system for all ACP member countries. This bandaging of a system promises former colonies access to EU banana import markets. 

The ACP safety net has made so called “post-colonial” Caribbean nation states, such as Belize, the Windward Islands, and Jamaica, economically dependent on UK agricultural markets. Although the ACP system has undermined national independence by closely re-tethering former colonies to parent countries, the global market trend of privileging corporations has made it impossible for commodity producers to compete without compromising sovereignty and sacrificing environmental resources and human rights. 

Inexpensive mass agricultural production requires thousands of flat acres to enable increased dependence on mechanized production and smaller workforces. Banana producing countries with hilly topographies rely on a number of smaller farms requiring extensive (and costly) irrigation systems and a limited reliance on mechanized production capacity. Areas frequently subject to devastating wea- ther (storms, earthquakes, drought) face double the likelihood of crops being damaged beyond saleability in a global market where agricultural products are required to be uniform in color, shape, and size. Thus ACP countries have come to depend on subsidies and promised market access, as overhead costs are too high to gain market access elsewhere.  

ACP banana market protections are governed by the EU trade and tariff laws, dozens of smaller trade agreements, banana distribution corporations, and, in the case of Belize, the UK. In 1995 the WTO, too, claimed jurisdiction over the ACP system. Within months of the WTO’s inception, the U.S. and Dollar Banana producers (bananas grown in Latin America for U.S. owned corporations) filed a case against the EU, citing ACP subsidies as a barrier to free trade. Those leading the grievances against the EU were not banana farm workers or trade unions, but local industry elites and U.S. banana corporations. Not surprisingly they are the same variety of leaders who once encouraged U.S. military operatives to overthrow democratic governments to create so-called banana republics. 

Few consumers and citizens of Dollar Banana countries understand that the erosion of ACP protections will not benefit the citizens of Dollar Banana producing countries or consumer freedom. The erosion of ACP benefits will only allow corporations producing Dollar Ban- anas to further control the global banana market. By placing market control in a smaller number of corporations, both consumers and producer countries will be forced to accept greater limitations on price and distribution company options. 

More importantly, ACP countries will be subject to national economic turmoil. Most ACP agricultural producers are dependent on their agricultural exports. Belize’s banana exports to the UK make up 20 percent of its national export market. Currently, subsidies allow Fyffes, Belize’s sole banana distributor since 1973, to purchase bananas at a low cost while producers receive a sum much closer to the actual production costs. Without subsidies, the Belizean banana market price will lower, causing a devaluation of the banana. If a devaluation occurs, producers will grow more in an attempt to remain afloat, flooding the market with an excess supply and causing market prices to collapse. 

According to Sam Mathias, operations manager of Belize’s Banana Growers Association, “If market prices collapse, then in turn so will producers whose costs are high (as lower prices will inevitably be passed down). Growers will increasingly cut corners to save pennies and in addition will not have the financial backing to re-build after severe climatic patterns that may disrupt production (such as hurricanes or low temperatures). Without a minimum threshold volume, it will be uneconomic to continue purchasing from Belize.” In the simplest terms, if required to pay the actual market price of Belizean bananas out of pocket, Fyffes will not buy Belizean bananas, leaving the industry in a state of collapse. 

The current Belizean banana regime was erected in the 1970s during a UK banana shortage. Since then, farmers have tried to diversify, but are met with the same geographic constrictions they have with bananas. The global trade regime is not favorable to countries unable or unwilling to exploit and ravage their environmental and labor resources. 

As it stands, the current global trade regime encourages producers to save pennies, no matter the environmental or human cost. Anticipating the loss of an assured market, ACP producers have, in the last few years, begun to cut corners. In Belize most farm owners began by lowering hourly wages and have since begun to pay by the piece or acre, instead of by the hour. This system does not take into account supervisors who do not tally the correct number of acres harvested or boxes of bananas packed by each worker. Events that prohibit workers from completing tasks—such as mechanical problems due to poor upkeep and aging machinery or the increased time and effort it takes to transport bananas from the field into the shed during rainy season—are not taken into account when determining by-the-piece wages.  

As icing on the cake, some farms in the Stann Creek District encourage supervisors to push production workers faster via verbal and physical intimidation by providing supervisors with economic bonuses.  Most workers are already selling their labor at below minimum wage, an illegal practice. 

In addition, the practice of farm management offices retaining workers’ passports inhibits them from moving to another farm or protesting conditions. If workers lose their jobs, their visas are no longer valid; if a job is lost while the employer is still in possession of a worker’s passport, the passport too may be lost and the worker deported. Fearing deportation, numerous workers from Guatemala and Honduras employed on banana farms in the Stann Creek District expressed ambivalence towards Belizean workers’ efforts to organize. 

In a similar vein, farm owners have cut costs by ignoring safety issues. On some Belizean farms, packing shed workers spend up to ten hours a day handling chemicals, but many farmworkers said they were not provided with informational about chemicals other than “wash your hands.” Packing shed workers are expected to purchase their own aprons to keep from getting soaked with watery detergent while moving bananas from washtubs to trays, but are not provided with or encouraged to purchase gloves that tie at the wrist to reduce chemical contact. 

Environmental impacts from heavy chemical usage include contaminated drinking water sources, depleted soil nutrients, and destruction of riparian zones. Riparian zones are composed of the organic plant matter that lines a river’s shore. Because soil in the riparian is more fertile, a diversity of indigenous plant matter exists there. This is clear cut and replaced with a single crop, such as bananas. This in turn exhausts the soil of nutrients, making it more difficult to grow products without the aid of additional chemicals. The clear cutting of the riparian creates a path for chemicals to enter rivers either through irrigation canals or by soil erosion during the rainy season. 

A September 12, 2005 decision called for the eradication of quotas on Dollar Bananas and the institution of a TO (Tariff Only) system of 190 euros per metric ton. This decision lowers the proposed tariff by 40 euros from the previously proposed tariff of 230 euros per metric ton. A WTO decision will most likely not be reached in January 2006, dragging on the debate and increasing the possibility of an even lower tariff. Mathias explained, “There is far too much detail that needs to be sorted out for it to work smoothly despite all the political statements.” This forced EU concession proves that current market trends are geared towards corporations. 

People who have little choice other than to sell their labor for less than minimum wage suffocate beneath the weight of First World privilege. In this world determined by intricate webs of community, economy, and history, people across the globe are bound together by existing injustices.

Alexandra Freedman is a recent BA recipient in history and women’s studies. 
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