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Business Monday: Controversy surrounding regionally produced bananas continues
12/7/2009
By Jewel Brathwaite
THE assault which some Latin American countries have waged on Caribbean bananas raise further questions as to whether smaller developing countries will make much headway with the concept of South-South cooperation.
When it is also considered that the Latin states involved – Ecuador, Costa Rica, Honduras and Mexico – interact with the Caribbean in a number of regional institutions and the apparently-defunct Free Trade Area of the Americas (FTAA), it indeed is baffling; a point echoed by CARICOM Secretary General, Edwin Carrington.
The issue at hand is that after years of tough bargaining, the Latin American banana producers have gotten the European Union to agree to the lowering of tariffs on Latin bananas entering Europe. The accord will see Europe reducing its import tariffs on Latin American bananas from $262 per tonne to $170 per tonne over the coming seven years. Of more significance is the fact that Caribbean producers account for a minimal share – under five per cent – of the banana market, although this region has a superior product.
There are fears that at that price, African, Caribbean and Pacific (ACP) producers will be unable to compete in the European market. This “war” over bananas has been ongoing for almost 16 years and is being fuelled by Chiquita and Dole, two American firms that have banana empires in Latin America.
Trinidad and Tobago’s Trade Minister, Mariano Browne said last week in Geneva that the settlement will result in the decline of a major CARICOM export commodity.
Reacting to the development, Carrington was quoted by the CMC as saying that the move by Latin America “raises for me a peculiar position”.
He said: “We are in the process of speaking about closer relations between Latin America and the Caribbean. We met in Jamaica on November 6 (2009)…and many of the countries that are party to that discussion…are the same parties whose struggles are pushing us out of the European market; our very limited access to that market in terms of quantity.”
For years, developing countries – also referred to as the South – have tended to share similar experiences in relation to their unequal dealings with the industrialized North. They have as a rule pushed the idea of closer cooperation among themselves as a continuation of their interactions in the former Non-aligned Movement and the Group of 77 developing countries, given they are unable to wrest a better deal from North.
South-South cooperation is about these coming together to undertake more trade and investment with each other and forge solidarity on issues which are vital to their interest and survival. At the WTO Ministerial conference in Cancun in 2003, it was developing countries who, having recognized that the talks were not going their way, decided to “pull up stumps”, leaving the Chairman to call a halt to proceedings.
Similarly, last year in Geneva it was the more advanced developing states that decided against the North having its own way, resulting again in the failure to reach a conclusion.
Here in the western hemisphere, both Latin American and Caribbean states are members of the Organization of American States. All of them benefit from assistance provided by the Inter-American Development Bank, of which they are members. Both groups participate in the activities of the Latin American Economic System (SELA), they are members of the Economic Commission for Latin America and the Caribbean (ECLAC), the Inter-American Cooperation on Agriculture (IICA), and the few who produce energy, are actively involved in the Latin American energy Organization (OLADE).
At times when some of the Latin American states seek accession to key international institutions like the United Nations and its specialized agencies, they dispatched their personnel to this region seeking support, since they recognized that the Caribbean alone accounts for a sizeable voting bloc within those organizations.
Therefore, when one looks at the behavior of the Latin Americans, it does place the onus on CARICOM to decide what kind of relationships it wants to have with those countries. CARICOM has to show solidarity with the affected countries and fight this battle. Those who are not banana exporters should be aware that if the regional producers of the fruit suffer export earnings as a result of the deal between Europe and Latin America, then they will not be able to buy the products manufactured in Trinidad and Tobago, Barbados, Jamaica and elsewhere across the region.
Right now as this battle continues, one can look into the supermarkets and will find a whole range of products manufactured by Dole and that crowd. Can this be allowed to continue? Caribbean diplomacy also has to make greater sense than what comes over at this time.
Said Carrington: “Latin American countries already enjoy massive benefits of the (European) market…yet we are being pushed out, while we on the other side are speaking about cooperation and fraternal relations.”
We wait to see what happens next.
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