Food or cash? The dilemma of African farmers

Alistair Smith Monday, 15 November 2010

Until now, Africa has been a relatively minor player in world banana trade: Cameroon, Côte d'Ivoire and Ghana accounted for around 4% of the trade in 2007 (FAOSTAT export data). Both Angola and Mozambique will join the nations that export their fruit to Europe, with major joint venture investments by the US-based Chiquita Brands. Dole, the world's biggest fruit company, is also reported to be looking for partners in Angola, having recently invested in a large plantation in Ghana through its part-ownership of Compagnie Fruitière. Cameroon regularly states that it intends to increase its exports.

Virtually all exports from Africa go to Europe, with France and the UK being the primary destinations. This is linked to geographical proximity and the shipping lines, but also to the fact that, as ex-colonies, African exporting countries have enjoyed duty-free access tariff in the single European market since 1993, unlike their competitors in Latin America. To avoid paying the 176 euros/tonne tariff to enter the EU market when this arrangement ran out, the three banana-exporting countries signed interim bilateral trade agreements with the EU when talks over a regional agreement broke down. This move to secure zero-tariff access for the long-term future means that the multinationals are in Africa to stay. Unless the tariff on bananas from Latin America is cut drastically, they will probably be looking to expand production.

Nearly all the 2007 exported volume of just over half a million tonnes is accounted for by medium- and large-scale producers linked to one of the three largest multinational fruit companies: Dole, Chiquita or Del Monte. In Cameroon, smaller producers were never involved in the export market, except for a small proportion supplying the organic market. In Côte d'Ivoire, however, nearly all the smaller growers left the market in the early 1990s when the marketing board was privatized and the big companies expanded their investment.

Although medium- and large-scale plantations employ high levels of labour compared to any other export commodity (there are an estimated 10,000 directly employed plantation workers in each of Cameroon and Côte d'Ivoire, and 1,300 in Ghana) wages are low and have fallen in relation to the cost of living. In Cameroon, for example, one local trade union estimates that average wages are only around half of what might be considered to be a living wage. Another key feature of industrial banana production is the high level of agrochemical inputs, including a range of toxic nematicides and insecticides which have wreaked havoc with the health of Latin American workers and their communities. Although overall levels of chemical application are lower than in Central America, African workers report a series of health, safety and environmental problems related to these products.

The middle path

The potential expansion of export banana production in Africa comes at a time when the nature of demand in the world market is changing. As consumers, especially in Europe, have become more and more aware of the social and environmental consequences of industrial banana production, so the demand for Fairtrade and organic fruit has grown. In some countries like the UK, consumer pressure has caused the whole nature of the market to change, a trend which the fruit companies are obliged to take seriously. By the end of 2007, an estimated one third of the UK market, Europe's second biggest, is accounted for by Fairtrade and organic banana imports.

Africa cannot afford to ignore this trend and, in theory, is better placed than some parts of the banana exporting world to take advantage for climatic and agronomic reasons. However, if African governments and civil society wish to attract the financial, social and environmental benefits inherent in Fairtrade and organic production, then they will have to persuade investors to change their traditional way of doing business. If Africa accepts the “business as usual” expansion model led by the fruit multinationals, then the risk is that they simply reproduce the same model of plantation-based development that has generated precious little development in Latin America.

What would be much more significant for Africa's development than a few tens of thousands of jobs is real investment in bananas and plantain for food security, especially in processed banana products. The two paths of exports and food security are not mutually exclusive, but the latter will generate or conserve far more livelihoods than the former. The example set by Uganda, the world's second biggest banana producer, to encourage the development of new food products should be expanded and replicated elsewhere in the continent. The existing technologies for innovative fibre products coming out of India, Australia and other producing countries should also be added into the mix. If research, development and investment were to be concentrated in the way that the Ugandan initiative has shown is possible – i.e. with the political will – banana could lead the way as part of a new, locally-rooted development model across many parts of sub-Saharan Africa.

Exports look like an easy way to make money and create employment, but what is left a generation or two later has to be weighed against the huge potential benefits of a largely untested way forward based on small-scale production and processing.