The recent decision by the EU to cut tariffs on Latin American bananas ended “the longest trade dispute in history.” In the deal, the EU, which is the world’s largest importer of bananas, agreed to gradually eliminate the preferential treatment that it provides to growers in former colonies.
The decision will allow Latin American exporting countries such as
What the EU’s decision means for labor conditions at plantations throughout banana exporting countries remains unclear. On the one hand, as the EU Trade Commission explains, the deal can potentially make the global banana market more stable, which will in turn encourage investment and growth, and hopefully “increased attention to wider production condition issues in the banana supply chains.” The EU also expects certain labor and environmental conditions from its trade partners and “does not tolerate” labor practices that fall below international norms.
On the other hand, the potential effects of this deal for small-scale banana exporters in former colonies could be devastating. As opposed to the large corporate-owned plantations in
In recent years stakeholders in the banana industry have made efforts to improve labor and environmental conditions on plantations and farms. For example, several of the large corporations have made genuineefforts to improve labor conditions on plantations, and global movements for sustainable business practices within the industry are gaining interest. Also promising is that as part of the deal, the EU has to aid the transition in the countries that enjoyed preferential treatment.
Economists regularly point out that in free trade there are winners and losers. Let’s hope that the parties involved in this deal make responsible decisions that result in positive changes in the working conditions for both the “winners” and the “losers.”