The Guardian 10 August, 2005
Caribbean banana workers hit by free trade
Martin Frazier
"Come Mr Tallyman tally me banana, Daylight come and me wan go home."
Harry Belafonte's Day O lament typifies the plight of the banana worker who labours
long, arduous hours and receives some of the lowest pay among agricultural workers. Yet,
as exploitative and laborious as it is, the banana industry has provided livelihoods for
thousands of peasant farmers in the Caribbean basin, especially the Windward Islands — the
four island states of Dominica, St Lucia, St Vincent and the Grenadines and Grenada.
That industry is about to undergo changes that may affect its very existence. Under the banner of
free trade, the United States, backed by big banana interests, has pressured the UK and European
Union to drop the traditional import quotas on bananas that have kept the industry alive in some of
the Caribbean's smallest states. This could sound the death knell for the Caribbean banana
industry.
A short history of bananas
Bananas were introduced to the Caribbean islands by British colonialism after the collapse of the
sugar industry there in the 1930s and '40s, when Northern European farmers started growing sugar
beets, encouraged by tempting state subsidies. Bananas were a means of providing a source of
island revenue and eased colonial expenditures on the islands.
Today, in the post-independence Caribbean, bananas remain one of the most important
commodities, particularly for the smallest states, feeding thousands of families in the most
economically depressed areas. Before its expiration in 2003, the Lomé trade convention (signed in
1975 in the Togolese capital of Lomé) provided for a traditional arrangement allowing preferential
access to European markets for former colonies, thereby safeguarding the livelihoods of thousands
of people and sustaining the economy of the Small Island Developing States of the
Caribbean.
While some regard the preferential access as an arrangement that cements dependency, many in
the region see it as a sort of reparations for many centuries of exploitation of Caribbean
people.
The Lomé provision has been the lifeblood of Caribbean bananas, which are otherwise unable to
compete with the products from Latin American plantations. The European market is particularly
important to the small economies of the Windward Islands, where income from banana exports to
Europe contributes almost half of the islands' total export earnings. Nearly 30 percent of the
Windward Islands' cultivated area is under banana cultivation. The fruit also constitutes a
significant share of earnings for much of rural Jamaica.
Farmers in a 'race to the bottom'
In an attempt to develop a contingency plan to deal with these impending changes, officials from
the Caribbean, Latin America and Europe met in Brussels in April to examine critical issues
affecting the industry.
At the top of the agenda of the Second International Banana Conference was the long-running
dispute over the marketing of bananas in Europe and increasing competition among banana
multinationals and giant supermarket chains. This increased competition has resulted in driving
down the prices being paid to small farmers, causing many to abandon banana farming.
In a show of Latin American and Caribbean unity, organisers of the meeting, which involved the
Windward Island Farmers Association (WINFA), European Banana Action Network (EUROBAN),
and Coordinating Centre of Latin America Banana Workers' Unions (COLSIBA), say they are
seeking to reverse "a race to the bottom" in the industry. Organisers say they want to promote
mechanisms for a socially, economically and environmentally sustainable banana trade
worldwide.
Bananas are among the world's top five most important traded fruit, second only to grapes. World
banana production amounts to some 65 million tonnes per year, concentrated in Africa, Asia, the
Caribbean and Latin America because of favourable growing conditions. Because bananas are so
tender, a larger yield is typically a result of increasing chemical use. It is estimated that an average
of 280 different pesticides are currently authorised in banana cultivation.
Big Banana
Five multinationals — Chiquita, Dole, Del Monte, Noboa, and Fyffes — control 80 percent of the
international banana trade. The top three corporations exert a virtual monopoly on Latin American
plantations. Their products are commonly referred to as "dollar bananas". Low wages, job
insecurity, excessively long working hours, and denial of trade union rights and freedom of
association are hallmarks of these corporations' practices in Latin America.
It is largely because of the dirty practices of Chiquita and its processor, the United Fruit Company
(UFC), in Latin America that the sordid term "banana republic" was introduced in contemporary
political economy discourse. UFC played a central role in coups de état, stealing of elections, union
busting and other anti-democratic actions in Latin American countries.
Banana agribusinesses expatriate most of the profits from producer countries. Only 12 percent of
revenues remain in the countries. Plantation workers only take home 7-10 percent, while small
farmers get only 1-2 percent.
While Latin American bananas are grown on large plantations controlled by these large
corporations, Caribbean bananas are grown on small family farms and cooperatives, with union
representation. Most Latin American bananas are marketed in North America; Caribbean bananas
are sold to the European market, particularly the UK. The cost of farm labour in the Eastern
Caribbean (about US$15 per day) exceeds prevailing wages in Latin America, where banana
workers rarely earn more than US$5 a day.
Banana producers are constantly pressured to produce at lower prices and push wages down in
order to drop prices, but the industry is a lucrative business for the multinationals. While the current
legal minimum price paid to a producer for a box of bananas in Ecuador is US$2.90, the same box
will then sell in a British supermarket for about US$25.00, with the supermarket taking 40 percent
of the final price.
Bananalink, a public advocacy group focusing on sustainable banana trade, estimates that the
British supermarket retailer Tesco makes about one million pounds profit per week from banana
sales, enough to employ 30,000 full-time banana plantation workers at a living wage (which would
be about twice what they're paid currently).
Wal-Mart enters the picture
A major concern of Windward Island banana growers is the acquisition of Asda, the UK's third
leading supermarket chain, by Wal-Mart. Asda's exclusive contract for Del Monte's bananas from
some of the world's cheapest sources has already started a retail price war that has caused
consumer prices for loose bananas to drop by more than a quarter.
"What they want to do is to drive everyone out of the market and then to raise the prices. The
people who supply Wal-Mart are paying people starvation wages in Central America and Latin
America in deplorable conditions", said Dr. Ralph Gonsalves, Prime Minister of St Vincent and the
Grenadines, in 2003 after the Wal-Mart Asda takeover.
Fair trade, not "free" trade
The WTO will decide on preferential access at a meeting this December. Hardly anyone expects it
will move in a favourable direction for Caribbean growers. Many see the US and Chiquita targeting
Caribbean bananas as part of a wider plan — CAFTA and, ultimately, FTAA.
With the stakes against them, many in the Caribbean are hoping for a fair trade alternative while
making a simultaneous effort at economic diversification. The fair trade movement promotes
trading partnerships that aim at sustainable development for excluded and disadvantaged
producers. It seeks to provide better trading conditions by raising awareness.
Fair trade has had six-fold growth in banana exports since the inception of the grassroots
association with Windward Island banana producers in 2000. The fair trade movement aims to help
alleviate poverty in developing countries by building direct relationships with disadvantaged
producers and fair access to markets in Europe and North America. Under the arrangement,
conscientious consumers in the developing countries pay more for bananas than they would for
"dollar bananas" distributed by the agribusiness multinationals.
The price is calculated to cover the farmers' costs of production, even if the world market price
fluctuates. Moreover, fair trade producers generate a social premium corresponding to the amount
of goods that they sell under the fair trade label. This premium is reinvested locally, for example,
building schools, strengthening collectivism, raising awareness on environmental and economic
literary issues, and providing local assistance such as community centres and helping poor families
pay for school.
The fair trade movement continues to grow in leaps and bounds. Fair trade bananas totalled 11.5
million tonnes in 2002. Four out of every 100 bananas sold in the UK now carry the fair trade
label.
Many workers in Latin American and Caribbean have not fallen for the divide and conquer strategy
of capitalist globalisation. In a joint CARICOM-Mercosur meeting in March, delegates signed a joint
communiqué agreeing that certain special goods or sensitive products must be given preferential
treatment, and set themselves a December deadline to iron out remaining differences on the
issue.
And on May 31, 50,000 Costa Ricans protested against the prospect of ratification of CAFTA by the
US Congress. Of particular concern is CAFTA's weak workers' rights provisions for an area already
suffering from appalling disregard of labour laws.
People's Weekly World Communist Party USA