Book Prospectus
Globalized Fruit:
Transnational Firms, Tropical Entrepreneurs and Governments,
and Independent Banana Development
Douglas Southgate and Lois J. Roberts
Summary. Bananas are the fifth most widely-traded farm product, exceeded in a ranking of
exports only by wheat, corn, soybeans, and barley. Yet the industry that supplies low-priced fruit to
consumers throughout the world is criticized far more often than it is praised. Many books dwell on the
transgressions of large corporations headquartered in the United States. Not content simply to chronicle
misdeeds in one industry, some authors also insist that the abuses resulting from monopolization in the
banana business, such as environmental pollution and the exploitation of labor, are broadly representative
of multinational misconduct in the developing world. To say the least, this claim calls into question the
idea that globalization is broadly beneficial, including for the Global South.
Without dealing in depth with specific accusations against firms such as the United Fruit
Company (now Chiquita Brands International), we challenge the core premise of the standard narrative
about the banana business, which is that those firms face no significant competition. This premise might
be valid in Central America, where a few multinationals still dominate the banana business. However, it
does not apply to Ecuador and Colombia, which started exporting tropical fruit on their own decades ago.
Not coincidentally, the same two countries went on to become the world´s top suppliers of bananas and
today account for more than 40 percent of all exports.
With its focus on South America rather than Central America, this book does not offer yet
another reprise on the familiar theme of monopolistic excess in banana republics. Instead, we put the
factors that underlie the development of independent fruit industries into sharp relief. Some of these
factors are environmental: for example, the absence of hurricanes in western Ecuador, which ships more
fresh produce overseas than any other place on earth. Also having an effect are government policies,
which reinforce or diminish the incentives that markets provide for investment, production, and trade.
Special attention is given in this book to local entrepreneurs. We investigate their origins, which
are more humble than privileged, as well as their careers, especially their paths to success in the banana
business. Entrepreneurs´ contributions to exports and development are a principal focus. Drawing on
interviews and archival research in the case of Ecuador as well as publications about Colombia, we show
that international marketing by these individuals has been aggressive and innovative. As a result, the
tropical fruit sectors of their respective countries have expanded more than would have occurred had
multinational dominance never been challenged. Along with larger harvests and increased exports,
domestic investments made by local businessmen and women have had a direct impact on gross domestic
product (GDP). Moreover, vigorous competition originating in the two South American nations has
driven down fruit prices, to the benefit of consumers in importing countries.
How this book adds to the literature. This book is distinctive because it addresses independent
banana industries as well as the economic role played by homegrown entrepreneurs. These industries and
individuals are barely acknowledged, if that, in the overwhelming majority of publications, which
concentrate instead on the U.S.-based companies that formerly controlled the banana industry and on
Latin Americans´ struggle against that control. Writings about this struggle used to deal mainly with
populism, nationalism, and unionization. However, the actions of “subaltern” groups, especially peasants
and plantation workers, now receive attention as well.
1
Gaps in the existing literature are not limited to the neglect of independent banana development
and national entrepreneurs. Analysis of the decisions of transnational firms also leaves much to be
desired. Consider the move away from vertical integration (a system in which each transnational firm
owned tropical plantations, a fleet of ships, and facilities inside the United States for distributing bananas)
after the middle of the twentieth century. A number of authors do little more than to point out that this
transition coincided with the strengthening of nationalism, mounting union militancy, and so forth.
However, Marcelo Bucheli highlights the importance of other causes in his history of United Fruit in
Colombia, such as sluggish growth in banana demand and anti-monopoly litigation in the United States.1
In addition to offering a superior analysis of multinationals’ choices, Bucheli devotes a chapter of
his book to the attempts of Colombian entrepreneurs to compete in overseas markets, often against
multinationals. But aside from this single chapter, almost nothing has been written about these
individuals, the obstacles they had to overcome, or their accomplishments. Even less studied are
Ecuadorian businessmen and women, whose achievements have exceeded those of their Colombian
counterparts. For example, Luís Noboa, who started out as an adolescent street-vendor but became the
largest banana exporter in Latin America, is mentioned a few times in Steve Striffler´s study of United
Fruit in Ecuador,2 but other entrepreneurs from the same country are ignored entirely.
Local entrepreneurs would merit little scrutiny if they were only agents of foreign firms or if their
actions were indistinguishable from those of the multinationals. However, Bucheli’s account and ours
leave no doubt about the independence of South American entrepreneurs. As we also show, their impact
on national development and the tropical fruit business as a whole is undeniable. Thus, books and articles
that give short shrift to this group furnish an incomplete view, with direct implications for the critique of
globalization offered in many of those publications. In contrast, our study provides fresh insights thanks
to its examination of independent banana development, the local entrepreneurs who are largely
responsible for this development, and its national and global consequences.
The intended audience. This book is being written with two groups of readers in mind. The first
group is made up of development scholars and practitioners, who should find our research about tropical
entrepreneurs and their contributions to trade and development new and useful. Specialists in Latin
America comprise the other part of the intended audience.
Part of the book´s appeal to the first group relates to the importance of exports of fresh produce
(broadly defined to include cut flowers) in various parts of the world, from Southeast Asia, to the
highlands of East Africa and the coastal plains of Ghana, to the Caribbean Basin and other parts of the
Western Hemisphere. The entrepreneurial factor is crucial in this trade, although not much studied.
Another attraction of the book for development specialists has to do with the restrictions that Ecuador
imposed nearly 75 years ago on transnational fruit companies, including on their land-holdings. These
restrictions, which Bucheli describes as unique and also views as a reason for independent banana
development in the country, resemble some of the measures proposed for dealing with the “foreign landgrab” (as many characterize it) currently happening in Africa. Thus, our analysis of policies that Ecuador
adopted in the 1930s has current relevance and is not just a matter of clarifying the historical record.
Among scholars who specialize in Latin America, those who follow the banana industry, which is
a key part of the region´s agricultural economy, will be interested in this book. In particular, readers
1
Marcelo Bucheli, Bananas and Business: The United Fruit Company in Colombia, 1899-2000 (New York: New
York University Press, 2005).
2
Steve Striffler, In the Shadows of State and Capital: The United Fruit Company, Popular Struggle, and Agrarian
Restructuring in Ecuador, 1900-1995 (Durham: Duke University Press, 2002).
2
aware of the shortcomings of the prevailing narrative about the banana business ought to welcome our
contribution to the literature.
The authors. In this book, the authors (whose résumés are included at the end of this proposal)
draw on their expertise in economics and history as well as direct observations either or both of them have
made in Ecuador, Colombia, and other parts of the Western Hemisphere.
A professor of agricultural, environmental, and development economics at Ohio State University
since 1980, Douglas Southgate has worked in fourteen Latin American and Caribbean nations and has
visited a number of others. The place he knows best is Ecuador, where he was a Fulbright research fellow
in 1987 and where he returned in 1990 for a three-year stint with the U.S. Agency for International
Development (USAID). This assignment resulted in a book about environmental issues facing the
country, which Oxford University Press published in 1994,3 as well as a number of scholarly articles and
papers. In recent years, his research has focused on the global food economy. A second edition of his
book on this subject has just been published by Wiley-Blackwell.4
Arriving in Guayaquil more than 60 years ago on a ship owned by the Standard Fruit Company,
Lois Roberts became acquainted with several of the port-city’s leading commercial figures and witnessed
the early development of Ecuador’s banana industry. After returning to the United States, she completed
her undergraduate education and went on to earn a doctorate in history. Among her publications are a
book about the cacao (cocoa) boom that Ecuador experienced a century ago, which was re-published
recently,5 as well as a volume about Middle Eastern immigrants who have settled and thrived in the
country.6 In recognition of her scholarly work, Roberts was inducted in 2008 into Ecuador’s Academia
Nacional de Historia, which was founded more than a century ago and currently has no other members
from the United States.
Contents of this proposal. A draft of the first chapter, which begins on the next page, is followed
by abstracts of the other nine chapters of the book and a list of bibliographic citations. As already
mentioned, the proposal concludes with the authors´ résumés.
3
Douglas Southgate and Morris Whitaker, Economic Progress and the Environment: One Developing Country’s
Policy Crisis ((New York: Oxford University Press, 1994).
4
Douglas Southgate, Douglas Graham, and Luther Tweeten, The World Food Economy, second edition (Hoboken:
Wiley-Blackwell, 2011).
5
Lois J. Roberts, El Ecuador en la Epoca Cacaotera: Respuestas Locales al Auge y Colapso en el Ciclo
Monoexportador (Quito: Gráficas Iberia, 2010).
6
Lois J. Roberts, The Lebanese in Ecuador: A History of Emerging Leadership (Boulder: Westview Press, 2000).
3
Chapter 1: Introduction
In demand everywhere, not just in the warm settings where they are harvested, bananas are
among the most widely traded of farm products. More tons of wheat are exported. Cross-border
shipments of corn, soybeans, and barley are greater as well. But bananas are next in a ranking of
agricultural exports by weight: in fifth place, well ahead of every other fruit and vegetable.
International shipments of bananas are a full order of magnitude greater than the cross-border
trade in rice, which is produced in enormous quantities in China, India, and other Asian nations though
almost entirely for domestic consumption. Economists characterize the international rice market as thin,
which is another way of saying that the staple grain of the world’s most populous continent is primarily a
local food. In contrast, huge numbers of bananas are consumed in the United States and other places
where there is little or no national production. Supplies in these places come from countries where a
minor share of output is consumed domestically, thereby allowing virtually all production to be sold
overseas. Truly, no farm product is more globalized than bananas.
Available each and every day on grocers’ shelves from Helsinki to Houston and from Seoul to
Santiago, the fruit is plentiful enough to be consistently cheap. A ton of soybeans is worth nearly as
much as a ton of bananas, even though shipping of the latter requires a lot of care and attention if bruising
and premature ripening are to be avoided. Likewise, the fruit’s price is little more than double the price
of wheat or corn, each of which is a dry commodity that needs no special handling. Coffee, tobacco, and
cotton are all more expensive – enough so for the total value of each of those three exports to exceed the
total value of bananas traded internationally. Since soybeans, wheat, and corn also place higher in a
monetary ranking of agricultural exports, bananas are in seventh place.
With tropical fruit supplied so amply and so economically throughout the world, one might
expect the literature to be full of encomia for the banana industry. However, most writings emphasize the
industry’s transgressions, especially wrongs done in the days when the business was monopolized by
transnational firms headquartered in the United States. A frequently quoted statement by Charles D.
Kepner and Jay Soothill about the United Fruit Company is representative of the condemnation.
“(This) powerful company has throttled competitors, dominated governments, manacled
railroads, ruined planters, choked cooperatives, domineered over workers, fought organized labor,
and exploited consumers. Such usage of power by a corporation of a strongly industrialized
nation in relatively weak foreign countries constitutes a variety of economic imperialism.”1
This judgment, which dates from the middle 1930s, reflects Depression-era antipathy towards big
corporations and does not even concede that cheap bananas have been a boon to consumers. Moreover,
United Fruit (now Chiquita Brands International) has not controlled any of its markets for decades.
Regardless, the narrative first articulated by Kepner and Soothill has had a lasting influence on the
literature, up to and including the latest books and articles about the banana industry.
This narrative does not deserve attention just because it has been repeated often, as it definitely
has been. Rather, it merits consideration because it contradicts the idea that globalization is widely
beneficial, for affluent and poor countries alike. If a few U.S. companies truly have a vise-like grip on the
banana business, then they capture the lion’s share of the financial gains from marketing tropical fruit
internationally, with little left over for producing nations. At the same time, monopolization allows
multinationals to impose many of the costs of banana production on those same nations: damage to
natural resources, for instance, as well as the poor health suffered by plantation workers exposed to
1
Kepner and Soothill, p. 76.
4
agricultural pesticides. This avoidance of costs, according to globalization’s skeptics, is why bananas are
as cheap as they are.
The market value of tropical fruit may indeed be too low, although no attempt is made in this
book to estimate how much prices might go up if each and every cost registered fully in the banana
industry’s bottom line. Neither do we disagree that control of the industry by one or two firms would
have deleterious consequences, perhaps along the lines described by Kepner and Soothill more than 75
years ago. Instead, our quarrel is with the prevailing narrative’s core claim, which is that the global
banana business and a handful of large U.S. companies are one and the same.
In fact, the banana business is much more competitive. Furthermore, competition is mainly an
outcome of something that is irreconcilable with the prevailing narrative and (judging from the literature)
never considered by the narrative’s adherents, which is the emergence in Latin America of banana
industries outside the control of multinationals. Development of this sort has happened in Colombia,
which is the second-leading exporter of tropical fruit in the entire world. But the other major example of
an independent banana industry, which is provided by Ecuador, is more striking. Wedged between
Colombia and Peru along the Pacific coast of South America and the smallest Spanish-speaking republic
aside from Uruguay in the continent, Ecuador is poorer than its neighbors, so may not seem the likeliest
country to have escaped the multinational yoke. Yet it has done exactly that. Not coincidentally, Ecuador
also has been the top exporter of tropical fruit for 60 years and currently supplies more than one in every
four bananas traded internationally.
The country has never been a satrapy of foreign firms – a banana republic, in other words – partly
because of the assertiveness of its government. Wary of monopolistic excesses, Ecuadorian authorities
imposed restrictions on United Fruit during the 1930s, shortly after that company began operating in their
country and around the time it was being vilified by Kepner and Soothill. Opportunities subsequently
opened up for local entrepreneurs, who over the years have made key contributions to Ecuador’s banana
sector and have made their mark in the global marketplace.
Entrepreneurs from Colombia and Ecuador are ignored in some books and articles about the
tropical fruit industry and mentioned in passing in most others. If they are written about at length, the
impression is given that they all come from the privileged elite. Where homegrown entrepreneurs prosper
– or, as some authors insinuate, where foreign companies allow them to prosper – their earnings are said
to derive from faithfully serving multinationals, by the merciless driving of their laboring countrymen for
instance.
Careful examination of the origins and careers of these businessmen and women reveals that this
characterization is, at a minimum, incomplete. For one thing, the South Americans who have achieved
the most in the banana business had humble beginnings (like the most successful of their U.S.
counterparts) and were instilled with an intense work ethic at a young age as their families struggled to
survive. To be sure, their treatment of workers and the environment often has been less than exemplary.
However, the commercial accomplishments of Colombian and Ecuadorian entrepreneurs cannot be
explained only in terms of exploitation. To the contrary, their success is mostly the result of competing
effectively around the world, frequently against transnational firms.
But for the region´s entrepreneurs, independent banana industries would not exist in Latin
America. The consequences of this development have been far-reaching. Fruit production and exports
have increased thanks to the extraordinary lengths that local entrepreneurs have gone to in overseas
markets: bartering bananas for vehicles and machinery behind the old Iron Curtain, for example. The
resulting impact on gross domestic product (GDP) has been amplified by the investment those same
individuals have made in ancillary enterprises, such as carton manufacturing. At the same time, the
5
tropical fruit industry as a whole has become more competitive, which is advantageous for consumers in
importing nations.
Examination of independent banana industries puts in sharp relief the contributions that local
economic actors make to agricultural trade and development. By insisting that transnational firms have a
stranglehold on the tropical fruit business, exponents of the prevailing narrative recognize neither
homegrown entrepreneurs nor their accomplishments and economic significance, who and which are
primary concerns of this book.
Satisfying the U.S. demand for fresh fruit through vertical integration
An understanding of independent banana development, which did not begin in Colombia and
Ecuador until the middle of the twentieth century, requires a survey of some previous history. It is
tempting to begin such a survey in 1899: the year when United Fruit and its long-time rival, the Standard
2
Fruit and Steamship Company (now Dole Food Company), were launched. However, selecting 1899 as
a point of departure for a brief history of the banana industry obscures the substantial effort that U.S.
merchants devoted during the preceding three decades to meeting demands in their country for fresh
produce all year round, not just in the months when apples, peaches, and other crops are harvested north
of the Tropic of Cancer. In the nineteenth and early twentieth centuries, the only way to satisfy these
demands, day in and day out, was to bring in bananas from the Caribbean Basin.
This line of commerce was fraught with risk, and not only because of the speed at which bananas
ripen and then rot. From 1885 to 1890, one out of every seven sailing ships used to carry fruit to the
United States ended up sinking en route.3 As historian Robert Read has documented, 92 of the 114
banana-importing firms that operated in the United States from 1870 to 1899 went out of business; of the
22 firms that remained at the end of the nineteenth century, all but four were small concerns.4
The leader of the four large firms, the Boston Fruit Company, was the product of an association
between Lorenzo Dow Baker and Andrew Preston. Captain Baker had helped introduce bananas to his
countrymen in 1870 by purchasing 160 bunches in Jamaica, catching a favorable wind to sail straight to
5
New York harbor, then selling the odd, exotic fruit at a handsome price. A year later, while delivering
bananas to Boston, he met Preston, who had little formal schooling yet possessed a unique gift for sales,
marketing, and distribution. Not long afterwards, Preston quit his old job so that he could work full-time
selling the fruit imported by Baker up and down the Atlantic Seaboard. This partnership was formalized
in 1885, when the two men joined ten private investors to found Boston Fruit.6
Another of the four large firms supplying bananas to the United States during the late 1800s, the
Tropical Trading and Transport Company, was headed by Minor Keith, whose career in railroads
included construction of a line linking the Caribbean coast of Costa Rica with the highland capital of San
José. Due to yellow fever and other diseases, this project cost the lives of thousands of workers whom
2
Del Monte, which is another major U.S. firm that supplies bananas and other tropical produce to the North
American market these days, got into the business after its 1967 purchase of the West Indies Fruit Company. Also,
United Fruit gained a leading position in the European banana trade when it bought Elders and Fyffes, a British
company, in 1904.
3
Read.
4
Ibid.
5
Langley and Schoonover, p. 34.
6
Cohen, pp. 41-42.
6
Keith had brought down from New Orleans as well as his own three brothers. But the reward for
completing it was a sprawling grant of land, some of which was cleared and planted to bananas.7
As the nineteenth century drew to a close, Boston Fruit possessed an impressive fleet of steampowered vessels, which brought in most of the bananas imported by the United States.8 Due largely to
Preston’s efforts, it also had the best network of ice-cooled railcars and warehouses for delivering fruit far
into the continental interior from coastal ports. But aside from 1,300 hectares that Baker had bought in
Jamaica, Boston Fruit’s agricultural land-holdings were negligible.9 In contrast, the holdings of the
Tropical Trading and Transport Company were extensive, far outstripping its assets for shipping and
distribution. Each firm’s shortcomings were overcome, however, by the merger of Boston Fruit and
Keith’s company in March 1899 that created United Fruit. Vertically integrated, the combined enterprise
was able to grow bananas in the tropics, ship fruit across the ocean without delay, then dispatch produce
quickly to customers throughout the United States.
Preston reinforced United Fruit’s dominance of the U.S. market by arranging for the company to
purchase shares in dozens of smaller competitors. To avoid being charged with violating the Sherman
Anti-Trust Act of 1890, the company made sure never to control more than 49 percent of the business in
any of the cities where it operated.10 Without a doubt, tacit cooperation was routine between the
commercial leviathan created by Baker, Preston, and Keith and other firms. But even as United Fruit
came to be known as The Octopus for wrapping its figurative tentacles around those firms, their
continuing existence helped create a legal defense that could be used in the event of anti-monopoly
litigation.
Of the competing businesses in which United Fruit held an equity-stake, the largest was Standard
Fruit. This company had a secure foothold in the southern United States because one of its founders, an
Italian immigrant named Joseph Vaccaro, had acquired a number of ice factories along the Gulf Coast.11
Like its larger rival, Standard Fruit had plantations along the northern coast of Honduras, a Central
American nation reached by sailing south from New Orleans or Mobile and then past the Yucatan
Peninsula (which is too dry for banana production). The company had received its Honduran properties
from the national government in return for building a railroad,12 exactly as Minor Keith had done three
decades before in Costa Rica.
Aside from the construction of railroads, which were needed to transport harvested fruit speedily
to coastal harbors, plantation development involved the clearing of jungles as well as the preparation of
land. Vertically-integrated firms also invested in ocean-going refrigerated vessels, commonly called
reefer ships, and climate-controlled facilities for distribution on land. In addition, United Fruit pioneered
the use of wireless radio, for the careful orchestration of banana-harvesting, transoceanic shipping, and
off-loading at import terminals.13
Thanks to all these investments and technological advances, fruit supplies multiplied, which
caused prices to plummet. As historian Virginia Scott Jenkins observes, few Americans in 1880 had ever
seen a banana. But 30 years later, bananas had long since ceased to be a luxury item and had become a
7
McCann, pp. 16-17.
Cohen, p. 43.
9
Read.
10
Cohen, pp. 46-47.
11
Koeppel, p. 56.
12
Soluri, p. 33.
13
Read.
8
7
dietary staple for the poor.14 The value of bananas coming in from Central America and the Caribbean,
which was less than $2 million in 1885 and amounted to $6 million in 1899, doubled during the first
decade of the twentieth century in spite of a dramatic reduction in prices.15
Sam the Banana Man
Along with United Fruit and Standard Fruit, a third vertically-integrated enterprise, the Cuyamel
Fruit Company, raised bananas in northern Honduras for the U.S. market. The driving force behind this
firm was Samuel Zemurray, who had been born on a wheat farm in present-day Moldova in 1877.
Having lost his father at a young age, Zemurray travelled with an aunt to New York in 1892 and from
there proceeded to Selma, Alabama to join an uncle who had a small store.16
Entrepreneurial risk-taking had to wait until the adolescent immigrant had arranged the passage
of his widowed mother and all his younger siblings, which he paid for out of the earnings from a series of
menial jobs. But with the entire family settled in Alabama by 1895, when he turned eighteen, Zemurray
was free to roll the dice a little. He staked $150 on bananas that were about to be discarded in the port of
Mobile because they had ripened during the passage across the Caribbean Sea and the Gulf of Mexico.17
With no money to spare, Zemurray offered a telegraph operator a percentage of sales revenues in return
for lining up buyers along the route taken by the train carrying the perishable cargo. The operator
accepted the deal, so the ready-to-eat bananas were all sold – at low prices, though still at a profit.18 After
three years of wholesaling mature fruit, Sam the Banana Man, as many people called Zemurray, had
$100,000 in the bank.19
In 1903, Zemurray sold 574,000 bananas, up from 20,000 in 1899. That same year, he met with
Preston in Mobile and signed a contract with United Fruit – to be specific, a contract for the young
entrepreneur to take bananas that were ripe or nearly so.20 In 1905, Zemurray and a partner named
Ashbell Hubbard purchased a financially-troubled steamship company, with partial backing from United
Fruit.21 The two businessmen also bought Cuyamel and its 2,000 hectares planted to bananas in northern
Honduras from the American who had founded the firm. Consistent with the general pattern, this real
estate had been acquired as a reward for building a railroad.22 Around this time, Zemurray relocated to
New Orleans, still two years shy of his thirtieth birthday.
The acquisition of Cuyamel and its Honduran farms coincided with an upswing in the U.S.
government’s interest in Central America. During the nineteenth century, official Washington had cared
little about the region, which had few economic ties to the rest of the world before the completion of a
railroad across the Panamanian Isthmus in 1854 made it profitable to ship coffee to Europe and the
eastern United States from Punta Arenas, Costa Rica and other ports along the Pacific coast. But
circumstances were markedly different after 1903, when the United States facilitated Panama’s separation
from Colombia and then started constructing an interoceanic canal across the narrow country. U.S.
leaders were concerned that past borrowing by Central American governments in Europe had rendered
them susceptible to outside influence. To keep this influence in check, the United States engaged in
14
Jenkins, pp. 22-27.
Bucheli, pp. 25-27.
16
Cohen, p. 12.
17
McCann, p. 18.
18
Cohen, pp. 19-21.
19
McCann, p. 18.
20
Cohen, pp. 24-25.
21
Ibid., pp. 27-28.
22
Soluri, pp. 32-33.
15
8
Dollar Diplomacy, whereby U.S. bankers purchased unpaid debts from their counterparts in the Old
World and the U.S. government guaranteed the repayment of principal and interest by taking over the
collection of export and import duties in the indebted countries.
Dollar Diplomacy was put into practice in Nicaragua in 1911, which marked the beginning of
more than two decades of colonial-style administration of the country by the United States.23 The
policy’s application around the same time in Honduras derived from bonds that national authorities had
sold to London investors during the 1860s to finance a railroad. Due mainly to fraud, the railroad was
never completed, although this did not prevent the British government from insisting that the debts be
settled. To resolve the problem, U.S. authorities arranged for financier J.P. Morgan to buy the bonds, for
15 percent of their face-value. Morgan then issued $5 million in new securities to the Honduran
government, with the understanding that a tax on exported bananas would be instituted and that U.S.
customs officials would be stationed in the country’s ports to collect the tax.24
By adding a penny to the cost of every bunch of Honduran bananas, this arrangement put
Cuyamel, which lacked agricultural holdings elsewhere, at a competitive disadvantage relative to United
Fruit, which had operations in Honduras but also grew or purchased fruit in other countries where exports
were not taxed. Zemurray protested, including in person to Secretary of State Philander Knox, though to
no avail. Unwilling to knuckle under, he then recruited and financed a small band of mercenaries to
topple the government in Tegucigalpa, with which he also had other disputes.25 The government fell and
its successor rejected the export-tax and other elements of the arrangement with Morgan and the U.S.
government, which was not at all popular in Honduras.26 Cuyamel prospered.
Adapting to Big Mike’s vulnerabilities and battling unions
In a political and economic history of Central America, Victor Bulmer-Thomas wonders how
U.S. fruit companies “could have resisted the temptation to meddle in (the region’s) internal politics”
during the early 1900s.27 But at the time, such interference aroused little controversy in the United States.
Instead, U.S. observers were impressed mainly by the companies’ ability to supply perishable goods
reliably to customers far away. The difficulties of this task were illustrated in John Steinbeck’s East of
Eden, which is set in California´s Salinas Valley during the First World War, when a failed attempt to
transport lettuce in ice-cooled boxcars to New York City almost ruins the story’s protagonists. Well
aware that shipping bananas from the Caribbean Basin to the United States was even harder than
enterprises of the sort depicted in Steinbeck´s novel, authors from the first part of the twentieth century
were unstinting in their praise of all that firms like United Fruit were doing to the benefit of the American
public.28
What was not understood 100 years ago was that the environmental underpinnings of the banana
business were fragile. Practically all the fruit imported by the United States were of the same cultivar:
Gros Michel, which translates from the French as Big Mike. Moreover, the standard practice in the
industry, today as in the past, has been to propagate bananas asexually, which implies that there is no
29
genetic variation whatsoever from banana plant to banana plant. Agricultural estates encompassing
23
Bulmer-Thomas, p. 29.
Cohen, pp. 75-76.
25
Soluri, p. 42.
26
Cohen, pp. 91-96.
27
Bulmer-Thomas, p. 15.
28
Upham-Adams, pp. 54-63.
29
It is biologically inaccurate to refer to banana plants as trees, which by definition grow from seeds. The pseudostem that bears leaves and bunches of fruit grows out of a swollen, underground stem, which is called a corm.
24
9
hundreds or even thousands of hectares all planted to a genetically identical crop represent monoculture in
the extreme. Factor in tropical heat and humidity and banana plantations comprise an ideal arena for
microbial mayhem.
The opening salvo in the microbes´ assault on the tropical fruit business occurred in the 1890s,
when the leaves on large numbers of banana plants in Panama started wilting and then dying and falling
to the ground. The culprit turned out to be a single strain of a soil-borne fungus (Fusarium oxysporum
Schlect. f. sp. cubense) against which the Gros Michel had no resistance at all.30 Tens of thousands of
hectares planted to that variety were lost during the next six to seven decades. Not until the 1950s was
Standard Fruit able to solve the problem by planting a new banana variety, Cavendish (also called
Valery), that the company´s scientists had spent many years developing.31
For much of the twentieth century, however, the primary response of United Fruit and its
competitors to Panama Disease (as the malady has been called ever since it was first detected) was not to
undertake the sort of research and development that lead to disease-resistant varieties. Instead, they
moved their operations to places not yet infected by the Fusarium oxysporum. Some tropical countries
gained from this relocation, as happened in Ecuador when United Fruit started investing in the country
during the 1930s (Chapter 3) as well as when Standard Fruit arrived after World War Two as a partner of
entrepreneurs based in the port-city of Guayaquil (Chapter 6). But when multinationals locked up
hundreds of thousands of hectares as reserves, which could be cleared and brought into production as
existing plantations were abandoned because of Panama Disease, the results could be disadvantageous for
host countries. As a former executive of United Fruit concedes, real estate acquisition went well beyond
what was required for “shifting plantation agriculture” – to use a term coined by John Soluri, a historian
of the banana industry.32 In 1952, the company
“ . . . owned or controlled three million acres of land. Only 139,000 of those acres were actually
planted in bananas; the rest were euphemistically carried on the books as ‘reserves,’ although one
of the most important reasons they were held was to guarantee that they would not become
farmland for our competitors.”33
Due to strategic behavior of this sort, competition was stifled in a key sector of various Central American
economies as well as the banana industry as a whole.
Territorial acquisition could even have political ramifications. A case in point was a dispute that
arose in 1915 over a productive region on the border between Guatemala, where United Fruit had secured
extensive territorial concessions in 1906, and Honduras, which was always the leading source of bananas
for Zemmuray´s firm. Each of the two governments rattled sabers occasionally at the urging of private
interests, and U.S. mediation was needed twice during the next 13 years to avert declarations of war.
Final resolution of the dispute had to wait until 1929, when the Boston Brahmins who had assumed
control of United Fruit after Baker, Keith, and Preston had retired or passed away decided to deal once
and for all with the company’s smaller yet troublesome rival.34 The resulting merger with Cuyamel made
Zemurray the leading stockholder in the company, although by early 1933 he had executed a hostile
takeover and was in charge of United Fruit (Chapter 3). In its account of the takeover, the New York
Portions of a corm containing secondary shoots can be cut off and transplanted, thereby extending monoculture to
new fields and different places.
30
Ploetz.
31
Soluri, pp. 178-180.
32
Ibid., p. 70.
33
McCann, pp. 39-40.
34
Soluri, pp. 73-74.
10
Times described him as “the fish that swallowed the whale,”35 thereby providing author Rich Cohen the
idea for a catchy title for his 2012 biography of the tycoon who had started out as a teenager trading in
bananas rejected by other merchants.
Matching the never-ending quest of vertically-integrated multinationals for land was the tight
control they tried to exercise over agricultural labor. The wages offered by the firms and benefits such as
food sold in company stores at below-market prices and medical care provided free of charge in company
hospitals were superior to the rural norm in countries such as Ecuador36 and Honduras.37 But in addition,
unionization was opposed vigorously. The companies did not always prevail in their disputes with
organized labor. For example, plantation workers in Honduras struck successfully in 1920 for a daily
wage of $1.75, with double-pay for overtime;38 this level of compensation was well above the $0.16 to
$0.50 per day earned by laborers on highland coffee farms in the same country.39
However, workers and unions also suffered major defeats. Twelve years after their victory in
1920, Honduran workers walked off the job again to protest wage-cuts the fruit companies had
imposed as the Great Depression was getting under way, although the 1932 strike was broken
and there was no return to the old wages.40 An unusually bloody confrontation had occurred four
years earlier in northeastern Colombia, where United Fruit had arrived at the turn of the twentieth century.
Opposed to the labor-contracting system that the company used not just in Colombia but on all its
plantations, strikers demanded regular employment as well as recognition of their union. In response, the
authorities in Bogotá dispatched a military force, which on 6 December 1928 killed 60 to 75 protesters in
the city of Ciénaga. This woeful incident achieved lasting notoriety once it was retold in One Hundred
Years of Solitude by Gabriel García Márquez, who appears to have exaggerated the death-count by more
than an order of magnitude.41
If the banana industry was widely praised early in the twentieth century, writings after the 1920s
were mainly about abuses committed by or on behalf of transnational firms. Representative of this shift
was the indictment of United Fruit quoted at the beginning of this chapter. In addition to having a lasting
impact on the literature, this indictment was received enthusiastically by Latin American critics of U.S.based multinationals. To capture what they saw as the pervasive and malign presence of United Fruit in
their part of the world, the critics started calling the firm El Pulpo (Spanish for The Octopus) long ago.42
Latin Americans take on El Pulpo
Far from cementing the banana industry´s hegemony over the Latin American nations that were
the source of its produce, events such as the 1928 Ciénaga massacre often galvanized opposing forces.
As Marcelo Bucheli notes in his history of United Fruit in Colombia, public revulsion over the incident
helped bring down the conservative regime that had been in power since 1904 and had provided tax
waivers, cheap land, and other inducements to foreign investors.43 The center-left victor of the 1930
election disappointed his radical supporters by not instituting a tax on banana exports and by extending
United Fruit´s lease on a railroad serving its zone of operations. However, the winner of the election four
35
Cohen, p. 144.
Striffler, pp. 47-49.
37
Soluri, pp. 131-141.
38
Karnes, p. 68.
39
Thompson, pp. 29, 97, and 137, cited by Bulmer-Thomas, p. 339.
40
Soluri, p. 11.
41
Bushnell, p. 180.
42
Jenkins, p. 20.
43
Bucheli, pp. 88-94.
36
11
years later, who was from the same party, signed Colombia´s first agrarian reform law, which among
other things strengthened the property rights of peasants who had occupied the uncultivated fringes of
large estates. Unions received support as well, including in the banana sector.44
United Fruit also encountered headwinds in Ecuador, which had been the world’s leading source
of cacao during the late 1800s and early 1900s but where production and exports collapsed soon after the
First World War due to plant diseases as well as low prices brought on by stiffer global competition. By
the middle 1930s, when United Fruit started acquiring farms within reach of coastal harbors, the country
had suffered more than a dozen years of economic stagnation and political instability. Nevertheless, the
company’s purchases aroused suspicions about large, foreign corporations that soon were expressed in
regulations specifically aimed at United Fruit (Chapter 3).
After World War Two, multinationals’ prerogatives were trimmed back throughout the Western
Hemisphere, including in Central American nations where the authorities formerly had spared no effort to
satisfy foreign investors in the fruit industry. Costa Rica and Honduras replaced old concession
agreements, which exempted those investors from taxes on profits, in 1949.45 In 1943, the former nation
had promulgated a labor code that established the rights of all workers, including in rural areas, to
organize and strike; similar codes were adopted in Nicaragua in 1945 and in Guatemala in 1947.46
Honduras did not follow suit immediately, although a strike in 1954 resulted in the recognition by United
Fruit and Standard Fruit of a single union representing all their employees.47
During the late 1940s and early 1950s, regimes preoccupied with communist influence,
especially within the labor movement, came to power in most of Central America. The most
important exception was Guatemala, where Jacobo Arbenz (a former army officer with leftist sympathies)
was elected president in 1951. Not content with raising duties on fruit exports and introducing taxes on
industry profits, as was happening elsewhere in Central America, Arbenz’s government opted for “a headon clash with (United Fruit) over land reform and financial compensation for expropriated land.”48 To be
specific, an order was issued in 1952 that uncultivated areas in holdings larger than 269 hectares be
redistributed to rural households with little or no land. The previous owners of confiscated properties,
including United Fruit, were to be paid off with bonds valued according to those owners´ tax declarations
(which invariably amounted to a small fraction of the market value of real estate), paying annual interest
of 3 percent, and maturing in 25 years. Dissatisfied with this arrangement, the multinational firm
portrayed the Guatemalan leader as a communist in a public-relations campaign and urged his removal
from office. Lobbied by United Fruit and concerned for its own reasons about Arbenz’s political
leanings, the U.S. government engineered a coup d´état in 1954 that drove the Guatemalan leader into
permanent exile.49
The opposition that fruit companies have encountered in Latin America is a recurring theme in
the literature. In a number of recent books and articles, special attention is given to the actions taken by
plantation workers and other “subaltern” actors. Instances of workers disobeying instructions for arduous
tasks, such as digging irrigation ditches and weeding, have been documented.50 So has peasants’
colonization of unused real estate (including land held in reserve due to the threat of Panama Disease) left
44
Ibid., pp. 96-100.
Bulmer-Thomas, p. 109.
46
Ibid., p. 133.
47
Soluri, p. 172.
48
Bulmer-Thomas, p. 109.
49
Rabe, pp. 44-6 and 54-63.
50
Soluri, p. 144.
45
12
unguarded by heedless owners.51 Based on his examination of United Fruit’s history in Ecuador, Steve
Striffler argues that the multinational’s decision in the early 1960s to relinquish all its agricultural
holdings in the country was in part the outcome of disputes with peasants over land they had occupied.52
Subaltern groups also have unionized, although the labor movement has supported some workers
more than others. One less-favored cohort consisted of men who before the 1960s applied an aqueous
solution containing copper sulfate and lime – known as Bordeaux Mixture since it was developed and first
used in French vineyards – so that banana plants would be protected from an airborne fungus called
Yellow Sigatoka (Mycosphaerella musicola Leach). Manual spraying was unavoidable because aerial
applications left the undersides of foliage exposed to the disease, which appears initially as leaf-spots and
cuts sharply into yields and fruit-quality.53 Constantly exposed to the fungicide, spray-workers suffered
eye inflammations, persistent coughing, and recurring headaches. Worst of all, the accumulation of
copper sulfate in the lungs resulted in symptoms like those of tuberculosis – which was widespread
among banana workers,54 not to mention poor people throughout the Western Hemisphere. Actual
verification of this occupational malady did not occur until the late 1960s, several years after the
discontinuation of manual spraying. At that time, the correct diagnosis was made after copper sulfate was
found in the lungs of Portuguese vineyard laborers,55 who ingested much less of the substance than sprayworkers on banana plantations did.
Even in the absence of medical proof of threats to human health, it was generally appreciated that
applying fungicides by hand was unpleasant at the very least, so spray-workers tended to be compensated
better than the rest of the labor force. But at the same time, their status was inferior. One problem was
that they were not equipped with machetes, unlike men who strode out into the fields only after girding
themselves with that macho implement. They were also given a derogatory nickname – pericos (meaning
parakeets in Spanish) – since constant exposure to the Bordeaux Mixture, which is blue, causes one´s skin
to acquire an aquamarine tint. In addition, pericos tended not to be union stalwarts, which cost them the
support of other workers. The labor movement in places like Costa Rica even objected to the phase-out
of manual applications (made possible by the discovery that the aerial spraying of oil in small
concentrations keeps Yellow Sigatoka in check) due to resulting workforce reductions as well as the loss
of bargaining power that unions possessed as long as they were able to interrupt disease-control.56
A literature with fundamental gaps and flaws
By highlighting the experiences of plantation laborers, peasants striving for land, and other
marginal groups, scholars such as Soluri and Striffler have broadened the scope of writings about the
banana industry, which used to focus on U.S.-based companies, Latin American governments, and major
figures in the private and public sectors. However, their contention of subaltern agency would be more
convincing if they gave due consideration to all factors bearing on the tropical fruit business, including
developments in public policy and markets far from the settings where bananas are raised. As a rule,
these developments have had little to do with the actions of workers and peasants (or even those of union
leaders and national presidents) south of the U.S. border.
Bucheli´s study of Colombia stands out in the literature because it addresses the full array of
forces influencing the banana business. As he emphasizes, the move away from vertical integration – in
51
Ibid., pp. 91-94.
Striffler, p. 62.
53
Peterson.
54
Soluri, pp. 153-154.
55
Cortez-Pimentel and Márques, cited by Soluri, pp. 125-126.
56
Marquardt.
52
13
particular, the divestiture of tropical plantations – that began in the 1950s coincided with diminishing percapita demand for bananas and other fresh produce in the United States, as the consumption of fruit in
processed form was rising.57 United Fruit had another reason for divestiture, which was the consent
agreement it signed in 1958 to settle an anti-trust case.58 Bucheli does not deny the effects of factors that
others have focused on, such as nationalism and unionization. However, his findings make clear the need
to investigate demand trends, anti-monopoly litigation, and so forth in places where bananas are
consumed in large quantities yet grow only in greenhouses.
The literature on the banana industry also would benefit from improved analysis of business
practices. Bucheli demonstrates how this analysis ought to be done in an examination of the monopsony
that United Fruit maintained for bananas in northeastern Colombia from 1900 to 1942. To be specific, he
shows that competition was suppressed in the region because the company had signed production
agreements with planters that forbade them to sell fruit to anyone else and that had other restrictive
clauses (Chapter 3). In contrast, Striffler is emphatic that contract-farming is a device that multinationals
use to subjugate growers, nothing more and nothing less, although he offers no explanation of how that
system actually works – either in Ecuador, where contract-farming has been widespread, or anywhere
else.59
On another subject, scholarly work cannot be regarded as authoritative if no attention is given to
local entrepreneurs. Bucheli´s book contains an excellent chapter about that group’s successes and
setbacks in northeastern Colombia as well as a separate area closer to Panama.60 Otherwise, Colombian
entrepreneurs have been ignored in writings about the country´s banana industry. Not much more
attention has been given to national businessmen and women in Ecuador, which as stated at the beginning
of this chapter provides the best example of independent banana development and also has been the top
exporter of tropical fruit for six decades. In his book, Striffler refers a few times to Luís Noboa, who like
Zemurray went to work at a young age after the death of his father (Chapter 2) but ended up amassing a
fortune by competing successfully against multinational fruit companies. Not acknowledged at all are
individuals such as Juan X. Marcos, the scion of a prominent commercial family in Guayaquil who
became Noboa’s mentor when the future tycoon was an adolescent street-vendor (Chapter 2), and
Segundo Wong, whose origins were humbler than Noboa’s but who grew wealthy by introducing
Ecuadorian bananas in a number of foreign markets (Chapter 7).
If Latin American entrepreneurs are given short shrift in the scholarly literature, they are
neglected entirely in writings intended for a general audience. Neither Peter Chapman nor Dan Koeppel,
who have completed books about the banana business in recent years (see list of references), mentions
Noboa or anyone like him. In his biography of Zemurray, Cohen does justice to his subject’s
entrepreneurial capabilities and accomplishments, going well beyond Koeppel’s characterization of Sam
the Banana Man as a “tough guy.”61 But otherwise, he makes the same omissions as the other two
authors. In particular, one can read Bananas by Chapman, Banana by Koeppel, and Cohen’s The Fish
that Ate the Whale and never learn that the company of Baker, Preston, Keith, and Zemurray has been
challenged successfully by an enterprising collection of Colombians and Ecuadorians.
With South American entrepreneurs receiving so little attention in the academic literature about
the banana industry, it is perhaps to be expected that these economic actors are ignored in the popular
accounts provided by Chapman, Koeppel, and Cohen. Regardless, it cannot be denied that the neglect of
57
Bucheli, pp. 33-38.
McCann, p. 65.
59
Striffler, p. 193.
60
Bucheli, pp. 149-179.
61
Koeppel, p. 71.
58
14
homegrown entrepreneurs reinforces the idea that the tropical fruit business has been and continues to be
dominated entirely by transnational firms headquartered in the United States.
There are other ways that an incomplete portrayal of the banana industry sustains the prevailing
narrative. Historical events of considerable importance tend to be downplayed if they undercut the
argument that U.S.-based fruit companies have always had their way in Latin America. Largely ignored,
for example, is the Honduran strike of 1920 that resulted in substantially higher wages for plantation
workers. Likewise, few authors match Soluri’s examination of the strike of 1954, which led to the
permanent recognition by United Fruit and Standard Fruit of a single union representing their Honduran
employees but had other consequences for workers as well (Chapter 5).
Other historical events are written about, though with slanted interpretations. A case in point is
Arbenz’s agrarian reform in Guatemala during the early 1950s, which is regularly portrayed as the sole
example from that time of Latin American resistance to foreign fruit companies – resistance that was
crushed in short order. In fact, this reform was undertaken as neighboring countries were starting to make
lasting changes in the way business was conducted, by taxing multinationals’ profits for instance.
Comparably tendentious is the account nearly every author provides of the removal of the Honduran
government that had acceded to the U.S. policy of Dollar Diplomacy during the early 1900s. It is
possible to depict this change-in-regime, which was received favorably in the Central American nation, as
a blow against yankee imperialism. But due to the involvement of a leading figure in the U.S. fruit
industry, whose interests aligned in part with those of Honduran nationalists, the event is treated instead
as a shameful example of a sovereign government’s subversion by a self-serving U.S. capitalist.
Finally, it is no accident that so much has been written about Central America, where banana
republics seem to have been the rule. In contrast, startlingly little has been written about Ecuador. There
is no explanation for this other than that the country has never been a banana republic.
This book´s content and organization
We attempt in the pages that follow to set the record straight, though not only for the sake of an
accurate portrayal of the banana industry. Our broader purpose is to clarify the role that entrepreneurs
play in economic development, which is a topic clearly in need of additional research,62 and also to
respond to the argument that globalization mainly serves corporations from wealthy nations but does not
really benefit the Global South.
Drawing on personal interviews as well as archival research, this book focuses largely on
Ecuador’s banana industry, which has been led by local businessmen and women for many years. That
country’s experience is compared and contrasted with that of Colombia, where the fruit sector also is
largely independent of transnational firms. Comparisons and contrasts are made as well with Central
America, where multinationals still have a strong presence.
The next five chapters address factors bearing on independent banana development. We begin, in
Chapter 2, with observations about geography and history. Environmental conditions influencing banana
production are described in Ecuador and other parts of the Western Hemisphere. Also, special attention is
paid to Guayaquil, which has been a hub of trade and entrepreneurship since the 1800s. As we
emphasize, the city had no equal at the turn of the twentieth century in other places where independent
banana development subsequently was less robust or never happened at all.
62
Friemand and Jones.
15
With the combined impact of geography and history on entrepreneurial specialization duly
acknowledged, we turn to the influence of national governments. As mentioned already and as explained
fully in Chapter 3, the involvement of foreign firms in Ecuador´s tropical fruit industry was circumscribed
by public officials soon after that involvement began, which created opportunities for domestic growers
and exporters. This intervention might hold general lessons, including for those parts of Africa where
foreigners are attempting to acquire real estate on a scale that Minor Keith would have admired. But
good governance, which includes sound macroeconomic management and the improvement of
infrastructure, has affected banana development at least as much. As documented in Chapter 4, the
Ecuadorian government has done things right at times, though not always by any means. The same can
be said of the governments of neighboring countries.
Where environmental conditions and governance favor banana production, and certainly where
foreign involvement in the industry is restricted, local entrepreneurs are able to step forward. These
individuals usually know more than anyone else (including expatriates working for multinational) about
doing business in their own countries. As noted in Chapter 5, some of them also have logistical and other
talents that make them useful associates of foreign companies.
Colombians certainly operate with great effectiveness in Colombia, just as Ecuadorians do in
their country. However, this does not mean that transnational fruit companies have welcomed Latin
Americans as competitors elsewhere in the world. Some of the obstacles that multinationals once placed
in the paths of their Colombian and Ecuadorian rivals are identified in Chapter 6. Also described are the
ways in which the most successful of those rivals overcame those obstacles, such as starting out in the
tropical fruit business as partners of U.S.-based companies prior to operating on their own.
After reviewing the factors that hinder or promote independent banana development, we explain
in Chapter 7 why this development matters. In northeastern Colombia, actual survival of the tropical fruit
industry after United Fruit’s departure, in the middle 1960s, depended on the tenacity of the region’s own
growers and exporters, who accomplished the costly transition from Gros Michel to Cavendish bananas
while dealing with hurricanes as well as national officials who were indifferent or even unsympathetic. In
Ecuador, the size of the banana industry owes much to international marketing by the country’s own
entrepreneurs that can only be described as aggressive and innovative. Moreover, the industry’s impact
on GDP has been enhanced by domestic investments of various sorts made by the same individuals.
Some of these investments, especially in the improvement of export-related services, have had positive
spillovers for other trade-based sectors.
Our analysis of the consequences of independent banana development continues in Chapter 8, in
which attention is given to small, independent farmers as well as plantation workers. The banana boom
that began in Ecuador in the late 1940s and continued for 15 years or so created unprecedented
opportunities for small and medium-sized planters in the country, who found it relatively easy to cultivate
the Gros Michel variety. Many of these planters did not survive the subsequent transition to Cavendish
bananas, the production of which is more demanding in terms of capital and technology. Children are
employed on many of the surviving farms, in violation of national laws and global treaties. Additionally,
few plantation workers are unionized, as United Fruit´s employees were before the company gave up its
Ecuadorian holdings a half century ago.
Environmental issues are addressed in Chapter 9. During the early 1900s, banana development in
Central America came at the expense of tropical forests. Likewise, great swaths of tree-covered land
were cleared in western Ecuador after World War Two as tropical fruit production in the country
burgeoned. In the 1990s, diminished shrimp harvests in the same setting were blamed on the run-off of
agricultural chemicals from banana farms, although subsequent investigation revealed that increased
16
shrimp mortality had other causes. The effects of chemical use on the health of plantation workers are a
continuing source of debate and concern.
Lessons to be drawn from the banana industry about the respective roles of U.S.-based
multinationals and local entrepreneurs are summarized in Chapter 10. In light of evidence provided in
this book, oft-repeated claims about tight multinational control of the banana industry, which have direct
implications for the debate over globalization, should not be regarded as the final word on the subject.
Unmistakable evidence is presented in this book of the impact of South American entrepreneurs, both on
the tropical fruit sectors of their respective countries and on the banana business worldwide, although we
are cautious about generalizing our findings to other industries and settings. Provided there is a match
between the capabilities of homegrown entrepreneurs and the opportunities available in global markets,
that group can make impressive contributions to agricultural trade and development.
They certainly have done so at specific times and places in the banana business, for reasons
examined in the chapters that follow.
17
Abstracts of Chapters 2 through 10
Chapter 2: Geography, History, and Entrepreneurial Specialization
Aside from small ventures with no material impact on the global fruit trade, independent banana
development has occurred in two parts of Latin America since the middle of the twentieth century. The
first setting is the Caribbean coast of Colombia, where United Fruit´s dominance of the industry started to
unravel during World War Two. The other is western Ecuador, which shipped its first bananas to the
United States during the 1930s and became a major exporter after 1945.
Each of these two settings has geographic advantages and disadvantages. Like Central America,
northern Colombia has direct access to major markets in North America and Europe, although it is
hammered from time to time by severe tropical storms. Ecuador is farther from the north Atlantic and the
country´s exporters also must reckon with tolls charged by the Panama Canal´s proprietors. However, the
western part of the country (the costa) is free of hurricanes. This obviously benefits national
entrepreneurs who trade only in Ecuadorian bananas. But the absence of severe storms also is an
attraction for multinational enterprises looking to cope with weather-related risks in other places where
they grow or buy fruit.
Yet another point in the costa´s favor is that it boasts an urban settlement of long standing.
Founded in 1538, Guayaquil was isolated from seats of governmental authority for nearly four centuries.
As a result, the entrepreneurial energies of its merchants were put to use mainly in the wider, commercial
world: introducing Panama hats to the world in the late 1840s, exporting large quantities of cacao during
the late 1800s and early 1900s, and taking the lead in various trade-related enterprises in recent decades.
To explain this entrepreneurial specialization, we draw on a taxonomy of business innovations which
Joseph Schumpeter proposed 100 years ago.63 In addition, William J. Baumol´s expansion of this
taxonomy is used to explain why business activity in Guayaquil generally has been productive, rather than
unproductive or destructive.64
Bucheli offers a different assessment of urban-based entrepreneurship in northern Colombia.65
Also, the Caribbean lowlands of Central America had no counterparts to Guayaquil – port-cities where
entrepreneurs had long been honing the skills and acquiring the foreign contacts that global commerce
requires – when United Fruit and Standard Fruit ventured into the region, little more than a century ago.
Chapter 3: Never a Banana Republic
Writing specifically about Honduras, Soluri is among the many authors who contend that
prolonged foreign control of large swaths of a developing country´s best farmland has lingering and
adverse effects.66 Also, economist Andrés Rodríguez-Clare identifies various circumstances under which
a poor nation realizes few benefits if it hosts a company from a more developed part of the world. For
example, cheap telecommunications might well deter the multinational from building up factors of
production that are scarce in the host country, such as the executive expertise needed for management or
marketing. If so, overall economic progress will be disappointing.67
63
Schumpeter, p. 66.
Baumol.
65
Bucheli, pp. 18-20.
66
Soluri, pp. 216-217.
67
Rodríguez-Clare.
64
18
The pitfalls of multinational involvement have been avoided in Ecuador´s banana sector. When
United Fruit started acquiring old cacao estates in the early 1930s with an eye toward producing bananas
in the costa, national authorities were not entirely accommodating to the company, as their counterparts in
Central America often had been in the early 1900s. Neither did they follow the example set by Mexico’s
leaders, who banned foreign ownership of farmland and drove out all foreign agribusinesses. Instead,
Ecuador´s government steered a middle course. Firms such as United Fruit were allowed to operate,
thereby facilitating inflows of capital and the transfer of technology. However, a law enacted in 1938
prohibited foreigners from owning more than 80,000 hectares: 30,000 hectares less than United Fruit’s
possessions in the country at the time. Furthermore, the company, like every other exporter, was
compelled to buy at least half its product from Ecuadorian farmers.68
Characterizing Ecuador´s approach as unique, Bucheli identifies it as a reason for independent
banana development in the costa.69 It also might yield lessons for African nations where foreign buyers
are attempting to acquire extensive tracts of prime farmland.
Chapter 4: Governance, Good or Bad, and Its Consequences
Aside from the restrictions implemented in 1938, which permitted enough foreign acquisition of
resources to secure the benefits of multinationals’ participation in the tropical fruit sector but stopped
short of the wholesale transfer of the costa´s best farmland, good governance during the late 1940s and
into the 1950s made Ecuador attractive for private investment, by foreign firms as well as local
entrepreneurs. Sound macroeconomic management prevented a recurrence of the inflation that had
plagued the country during the 1920s and 1930s. At the same time, major improvements were made in
the transportation system. Under these circumstances, fruit exports from Ecuador skyrocketed. After
increasing from 1.2 million to 1.9 million bunches per annum during the 1930s, shipments overseas rose
to 2.7 million bunches in 1947, 16.8 million in 1952, and 23.9 million three years later.70 By the middle
1950s, the South American nation was the world’s leading source of bananas.
Governance in banana-exporting nations has not always been so exemplary. After the 1950s, the
Ecuadorian government adopted a development strategy predicated on import-substituting
industrialization (ISI). Incentives consequently diminished for the production of commodities in which
the country has a comparative advantage,71 including tropical fruit. Likewise, the conversion from Gros
Michel to Cavendish bananas in northeastern Colombia was impeded during the 1960s by a central
government committed to ISI. For various reasons, not least the agriculture minister’s conviction that
prices for the traditional variety would go up once the switch to Cavendish fruit had been completed in
other parts of the world, licenses to buy the foreign technology that conversion required were withheld for
a few years.72 In the meantime, valuable ground was lost to competitors in other places.
Chapter 5: Departures from Vertical Integration
Free of hurricanes and less afflicted than the Caribbean Basin was by plant pathogens, western
Ecuador was an obvious place to raise bananas for markets around the world once the Panama Canal was
completed, nearly 100 years ago. Enhancing the country’s advantages in the middle of the Twentieth
Century were sound macroeconomic management and accelerated investment in roads, bridges, and other
infrastructure. Transnational companies had a keen interest in Ecuador, as demonstrated by United
68
Registro Oficial No. 223.
Bucheli, p. 62.
70
Riofrío, p. 11, cited by Wunder.
71
Scobie, Jardine, and Greene.
72
Bucheli, op. cit., pp. 167-168.
69
19
Fruit’s acquisitions of real estate in the costa before World War Two and Standard Fruit’s arrival in the
region shortly after the conflict ended. However, regulations adopted in 1938 barred replication of
vertically integrated operations of the sort each company had established in Central America and other
places during the early 1900s.
By no means can the unfolding of Ecuador’s banana industry after the Second World War be
attributed solely to restrictions on the ownership of land by foreigners, mandates to purchase fruit from
local growers, and the like. To the contrary, the departure from vertical integration that occurred in the
costa was consistent with broader developments. In northeastern Colombia, the lapse of producers’
contracts, which United Fruit had used to monopolize banana exports from the region, provided an
opening for competing shippers (Chapter 3), which they did not take long to exploit. Also, an anti-trust
lawsuit launched by the U.S. government in 1954 resulted four years later in a consent decree that obliged
the industry-leader to spin off 20 to 25 percent of its operations: enough to create a competitor the size
of Standard Fruit, which for decades had been United Fruit’s principal rival. The latter company, then,
was in no position to undertake a major expansion, complete with new plantations, in Ecuador or
anywhere else.
Shifting market conditions also reduced the attraction for U.S.-based firms of investments in
tropical agriculture. Through the 1960s, per-capita consumption of bananas in the United States remained
flat due to the growing popularity of processed products, so imports increased only as fast as the
population did. There was more demand growth in Europe, although imports from current or former
colonies in Africa and the Caribbean were favored over purchases from Central and South America.
Under these circumstances, incentives for United Fruit and Standard Fruit to add to their plantations in the
latter settings were not overpowering.
Even if incentives for investment had been strong and if there had been no legal constraints on the
direction that investment could take, there was ample reason for multinational fruit companies to move
away from the vertically integrated approach they had used for decades. For example, buying fruit from
local growers offered multinational firms a way to avoid dealing with a unionized workforce on those
firms’ plantations. Those same growers tended not to offer a premium over normal levels of
compensation, so doing business with them enabled foreign companies to save money that otherwise
would have been spent on above-market wages as well as free medical care and subsidized food provided
to plantations workers and other employees.
There were other reasons to engage in commercial transactions with the citizens of tropical
nations rather than taking them on as employees in a vertically-integrated enterprise. As a rule,
Colombians are better able to get things done in Colombia than anyone else. By the same token, Costa
Ricans generally are more effective than foreigners in Costa Rica. The same holds for other national
groups and their respective countries, in terms of dealing with local courts and bureaucracies, overcoming
logistical hurdles, and other tasks. Additionally, people with an entrepreneurial streak can be expected to
perform more efficiently by operating on their own rather than as corporate employees.
Ecuador was by no means the only place in Latin America where commercial exchange among
independent economic actors made more sense than vertical integration, including for transnational firms.
However, each and every advantage of commercial specialization and trade was on clear display in the
country, thereby making it an ideal setting for independent banana development.
Chapter 6: How Latin Americans Became Banana Exporters
Fifty or 60 years ago, the gains created inside the borders of fruit-producing countries thanks to
specialization and trade between foreign firms and local growers and merchants were obvious to all
20
concerned. In contrast, multinationals had no real interest in helping individuals such as Noboa export
bananas on their own, since this was bound to increase competition for United Fruit and Standard Fruit in
markets those two firms formerly had to themselves.
Contracting schemes of the sort United Fruit had used to suppress competition in northeastern
Colombia until 1942 broke down during the Second World War and proved impossible to restore after
1945.73 Still, the transnational fruit companies had ways to discourage would-be exporters from Latin
America: flooding dock-side markets with bananas whenever competitors´ vessels approached port, for
example. More promising for a new exporter was to send produce to markets not controlled by United
Fruit and Standard Fruit. Anacreonte González, for example, began shipping bananas from northeastern
Colombia to Sweden in 1946 and his countrymen started doing business in Germany soon afterward.74
Another way for Latin Americans to enter the international banana trade was to partner with a
major U.S. firm. The best example of this approach involves Standard Fruit, which after the Second
World War decided it needed a source of bananas south of the Panama Canal so as to supply the growing
U.S. market. Rather than establishing its own plantations in Ecuador, as United Fruit had done in the
1930s (Chapter 3), the company decided to be a fruit-purchaser, operating through local intermediaries.
The intermediaries it chose were Noboa and Marcos.
These two individuals had accumulated capital a few years earlier by exporting rice. Also, as
mentioned in the preceding chapter, Noboa had gained logistical experience, which he drew on to deliver
bananas speedily, punctually, and in proper quantities to reefer ships. As a result, the venture with
Standard Fruit flourished, along with Ecuador’s banana sector as a whole. In 1955, the U.S. firm
announced that its association with the two Ecuadorians had come to an end, ostensibly because it no
longer needed local intermediaries. But the real reason for the parting of ways was that Noboa (who
never broke ties with Marcos) had determined he could do better on his own.
As his career progressed, Noboa expanded into North America, Europe, and beyond, almost
always beginning as a partner of individuals who could help with distribution networks, the clearing of
bananas through ports, etc. Growth in these undertakings was consistently achieved, thanks mainly to the
effort and attention that Noboa gave to supplying ever larger quantities of fruit. Other independent
exporters, in Ecuador as well as elsewhere in Latin America, did likewise in order to survive and prosper.
Chapter 7: Who Better To Build a Banana-Exporting Powerhouse?
Even in Colombia and Ecuador, where banana development took a decidedly independent turn
many years ago, transnational firms have made, and continue to make, important contributions. U.S.based multinationals are the industry’s technological leaders and routinely provide guidance on farming
methods to growers throughout the Western Hemisphere and even share new varieties developed by the
companies´ scientists. One reason for doing so is that blocking the informal transfer of this sort of
technology is hard. But in addition, the companies gain from maintaining the integrity of fruit supplies in
places with independent banana industries, for the simple reason that they still buy large quantities of
produce in those places.
While multinationals’ contributions are undeniable, local entrepreneurs are largely responsible for
the current state of the banana sector in South America. Take northeastern Colombia. United Fruit
withdrew from the region in the middle 1960s. Partly a response to slackening demand for bananas in the
United States, the company’s departure also resulted from the switch to the Cavendish variety, which
73
74
Bucheli, pp. 158-162.
Ibid., pp. 159-160.
21
originally was undertaken to overcome Panama Disease (Chapter 1) but which had the added impact of
raising yields on the company’s remaining plantations in Central America. Local bananeros
subsequently had to undertake the varietal transition, which required a sizable investment,75 with little
support from the national government (Chapter 4) and in the face of hurricanes that damaged their farms
in 1966, 1967, and 1968.76 They persevered nevertheless, thereby saving their industry. Among the
consequences was that United Fruit was able to return to northeastern Colombia during the 1980s, when
mounting disorder and violence drove the company out of the Urabá region in the northwestern part of the
same country.77
As in Colombia, the banana sector in Ecuador has had to deal with indifference or worse from
national authorities, especially when ISI has been pursued (Chapter 4). But as emphasized in Chapter 2,
there is less weather-related risk in the costa. Furthermore, Noboa, Marcos, and other exporters had been
operating on their own for several years before United Fruit’s departure from northeastern Colombia,
which obliged entrepreneurs from that region to follow the example set by their neighbors to the south.
A specialty of the Ecuadorians has been the opening of markets not served previously by a
multinational or any other firm dealing in tropical fruit. Long before the Berlin Wall was breached, for
example, they pioneered the bartering of bananas for vehicles, machinery, and other products in the
Soviet Union and Eastern Europe. This trade, in which U.S.-based firms never participated, was lucrative
in its own right, if for no other reason than the subsidized prices for the goods made available by
communist vendors. Moreover, the head-start the Ecuadorians gained for themselves behind the Iron
Curtain yielded long-term dividends, in the form of sales in later years. In contrast, Chiquita Brands
International (formerly United Fruit) invested heavily in plantations and other capacity during the 1980s
in anticipation of increased exports to Eastern Europe and the old Soviet Union. However, the return on
this investment turned out to be disappointing,78 in part because the Ecuadorians’ head-start in the region
could not be overcome.
Along with Noboa, Segundo Wong was a past master of bartering in communist nations and other
innovative approaches to the marketing of tropical fruit. Thanks to these businessmen and others like
them, banana exports from Ecuador surged as the twentieth century drew to a close. These entrepreneurs
also invested in packaging factories and other enterprises that provide inputs to the tropical fruit industry,
thereby contributing to GDP growth. This growth also has been enhanced by improvements in financial
and shipping services, which have had positive spillovers for other export-oriented sectors and industries.
Chapter 8: Workers and Peasants
No one has benefited more from independent banana development in South America than the
homegrown entrepreneurs largely responsible for that development. None of their businesses are public
corporations, so the precise dimensions of their wealth and assets are unknown. However, a glimpse of
Luís Noboa’s fortune was provided following his death in 1994, during the legal squabbling that ensued
75
Although Cavendish bananas resist Panama Disease and feature higher yields, their thin skins make the fruit
highly susceptible to bruising. To deal with this problem, farms where the variety is planted feature a network of
wires, along which freshly-cut bunches move to local packing plants where hands of fruit are removed from stems,
washed, and boxed. Adding to the expense of Cavendish production are the systems of pipes and machinery used
for irrigation and fertilization, which are needed to achieve elevated yields.
76
Bucheli, pp. 167-168.
77
Ibid., pp. 168-170.
78
Bucheli, p. 177.
22
among his heirs. According to court records, the man who started out with nothing and built the largest
banana company outside the United States had an estate worth at least $600 million at the end of his life.79
Noboa’s countrymen also have gained from increased fruit production and exports, and not just
his fellow businessmen and women in Guayaquil. During the late 1940s and into the 1950s, the banana
market was strong and credit requirements for the production of Gros Michel bananas were modest
(because the first harvest occurred less than a year after planting). Under these circumstances, thousands
of individuals, including peasants, fanned out across the costa to occupy and clear new farms of 50
hectares or less.80 Economic opportunities improved enough and so many small and medium-sized farms
were created that there was never much pressure for agrarian reform.81 Even the workers who labored on
United Fruit´s plantations had union representation and earned enough to support themselves and their
families, as critics of the company have admitted.82 It is no exaggeration to say that the banana boom
transformed Ecuador from a traditionally Andean country, with most of the population destitute and tied
to highland haciendas founded in the colonial era, to a mainly coastal nation, one that is more capitalist
and less poor.
Replacement of the Gros Michel variety with Cavendish bananas had profound effects in the fruit
sector, not least for farmers and workers. Since Cavendish production is more capital-intensive and
technologically demanding, many of the costa´s smaller and medium-sized growers have switched to
other crops. On holdings where bananas are still raised, the legal prohibition on employing people who
are not yet 18 years old appears to be widely flouted.83 Additionally, the disappearance of plantations
owned by U.S.-based firms has not worked to the advantage of the rural labor force. As the president of
United Fruit observed during the 1960s, wages and benefits paid by the company were well above what
national growers in the costa offered.84 To this day, levels of compensation on Ecuadorian plantations are
in line with prevailing rural wages, no less but certainly no more. Only a tiny minority of the region´s
agricultural workforce is unionized.85
Chapter 9: Environmental Trade-Offs
With the exception of the southern costa, where semi-arid lands have given way to irrigated
plantations, the geographic expansion of the banana industry has come at the expense of tropical moist
forests. Along the Caribbean coast of Central America, this change in land use dates back as far as the
late 1800s. After the Second World War, accelerated deforestation coincided with rapid expansion of the
banana sector in western Ecuador.
In his analysis of land-use change, Sven Wunder distinguishes between direct deforestation,
defined as the clearing of trees and other natural vegetation to make way for new banana farms, and the
indirect losses of forests traced to broad economic and demographic developments set in motion by the
banana boom. Direct deforestation was substantial in the costa between the late 1940s and the early
1960s, just as it had been earlier in the century in Honduras in neighboring countries. But whereas forests
were displaced by foreign-owned plantations in the latter setting, small and medium-sized farmers eager
to raise Gros Michel bananas were primary agents of land-use change in western Ecuador. But after the
switch to Cavendish, which is a more capital-intensive crop (Chapter 8), those farmers cleared very little
79
Freedman.
Wunder.
81
Redclift.
82
Striffler, pp. 47-51.
83
Pier, pp. 20-21.
84
Arthur, Houck, and Beckford, p. 147.
85
Pier, pp. 58-59.
80
23
land. Moreover, Cavendish yields were higher than Gros Michel yields (Chapter 7), so direct
deforestation abated noticeably. However, as Wunder emphasizes, indirect deforestation continued
because of the migration and economic expansion from other parts of the country that happened in
western Ecuador as the tropical fruit sector grew.86
During the waning years of the twentieth century, other environmental consequences of banana
production started to provoke much concern. Fruit companies have been sued over the poor health
allegedly suffered by plantation laborers exposed to agricultural pesticides.87 In the early 1990s, the
charge was made that elevated shrimp mortality in Ecuador, which at the time was a leading exporter of
the shellfish, could be attributed to chemical run-off from banana farms.88 However, subsequent research
revealed that a virus living in the coastal ponds where shrimp are raised was responsible.89
Chapter 10: Reassessing the Prevailing Narrative
At the turn of the twentieth century, the Caribbean lowlands of Central America were the obvious
place to grow bananas for the U.S. market, in which demand was burgeoning. However, the region was
sparsely inhabited and covered with dense forests. Also, it had no port-cities of any consequence. Under
these circumstances, banana development required sizable investments.
Before making these investments, U.S.-based companies insisted on grants of real estate, taxwaivers, and other inducements, which they received from national authorities who confined themselves
mainly to San José, Tegucigalpa, and other highland capitals. Extensive land-holdings were the
cornerstone of vertical integration, on which success in the banana business hinged for decades.
Ownership of this real estate also gave the multinational firms monopoly power.
Such were the early years of the international banana business. But even though the world
changed and fruit companies with it more than half a century ago, banana republics of the sort that
formerly existed in Central America continue to transfix many contributors to the literature. Writing as if
the industry is monopolized today by two or three firms as much as it ever has been, these authors also
claim that the banana business, as they depict it, is broadly representative of multinationals´ dealings with
poorer parts of the world – dealings that are invariably exploitative. The critique that all this implies for
the idea that globalization is widely beneficial, including for the Global South, is obvious.
This book challenges the standard portrayal of the banana business, in particular by documenting
the substantial competition that exists thanks to the emergence of independent fruit industries in South
America. Never conceding that such industries actually exist, most authors do not examine the factors
underlying independent banana development. As indicated in this volume, some of these factors are
environmental, such as the absence of hurricanes in western Ecuador. Also, the governments of fruitproducing nations have had an important impact, by using public policy to strengthen or weaken
incentives for investment, production, and trade.
Clearly, national entrepreneurs have been key actors in independent banana development. These
individuals do not deserve hagiographic treatment, and no such treatment is provided in this book. But
that said, Ecuador and Colombia would not be the source of more than two out of every five bananas
traded in international markets were it not for businessmen and women from those same countries.
86
Wunder.
Koppel.
88
Wrigglesworth.
89
Hasson et al.
87
24
By no means have we exhausted the subject of entrepreneurs’ contributions to agricultural trade
and development. We hope that our findings will encourage similar research in other settings, thereby
shedding additional light on an important economic force at work in the world food economy.
25
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Arthur, Henry B., James P. Houck, and George L. Beckford. Tropical Agribusiness Structures and
Adjustments: Bananas. Cambridge: Harvard Business School, 1968.
Baumol, William J. “Entrepreneurship: Productive, Unproductive, and Destructive,” Journal of Political
Economy, 98 (1990), pp. 893-921.
Bucheli, Marcelo. Bananas and Business: The United Fruit Company in Colombia, 1899-2000. New
York: New York University Press, 2005.
Bulmer-Thomas, Victor. The Political Economy of Central America since 1920. Cambridge: Cambridge
University Press, 1987.
Bushnell, David. The Making of Modern Colombia: A Nation in Spite of Itself. Berkeley: University of
California Press, 1993.
Chapman, Peter. Bananas: How the United Fruit Company Shaped the World. Edinburgh: Cannongate,
2007.
Cohen, Rich. The Fish that Ate the Whale: The Life and Times of America´s Banana King. Hew York:
Farrar, Strauss, and Giroux: 2012.
Cortez-Pimentel, J. and Fernando Marqués. “Vineyard Sprayer´s Lung: A New Occupational Disease,”
Thorax, 24 (1969), pp. 678-688.
Freedman, Michael. “Slippery Situation,” 17 March 2003
(http://www.forbes.com/forbes/2003/0317/108_print.html). Accessed 19 March 2012.
Friedman, Walter A. and Geoffrey Jones. “Business History: Time for Debate,” Business History
Review, 85 (2011), pp. 1-8.
Hasson, K.W., D.V. Lightner, B.T. Poulosl, R.M. Redman, B.L. White, J.A. Brock, and J.R. Bonami.
“Taura Syndrome in Penaeus vannamei: Demonstration of a Viral Etiology,” Diseases of Aquatic
Organisms, 23 (1995), pp. 115-126.
Jenkins, Virginia Scott. Bananas: An American History. Washington: Smithsonian Institution Press,
2000.
Karnes, Thomas L. Tropical Enterprises: The Standard Fruit and Steamship Company in Latin America.
Baton Rouge: Louisiana State University Press, 1978.
Kepner, Charles D. and Jay Soothill. The Banana Empire: A Case of Economic Imperialism. New York:
Vanguard Press, 1935.
Koeppel, Dan. Banana: The Fate of the Fruit that Changed the World. New York: Hudson Street
Press, 2008.
Koppel, Nathan. “Dole Settles Pesticide Litigation,” 4 October 2011
(http://blogs.wsj.com/law/2011/10/04/dole-settles-pesticide-litigation/). Accessed 17 August 2012.
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Langley, Lester D. and Thomas Schoonover. The Banana Men: American Mercenaries and
Entrepreneurs in Central America, 1880-1930. Lexington: University of Kentucky Press, 1995.
Marquardt, Steve. “Pesticides, Parakeets, and Unions in the Costa Rican Banana Industry, 1938-1962,”
Latin American Research Review, 37 (2002), pp. 3-36.
McCann, Thomas. An American Company: The Tragedy of United Fruit. New York: Crown
Publishers, 1976.
Peterson, Ron. “Banana Leaf Spot Diseases,” Queensland Government Department of Primary Industries
and Fisheries note, 4 February 2004 (http://www2.dpi.qld.gov.au/horticulture/5247.html). Accessed 14
November 2011.
Pier, Carol. Tainted harvest: Child Labor and Obstacles to Organizing on Ecuador´s Banana
Plantations. New York: Human Rights Watch, 2002.
Ploetz, Randy C. “Panama Disease: A Classic and Destructive Disease of Banana,” Plant Health
Progress online series, 4 December 2000
(http://www.plantmanagementnetwork.org/pub/php/management/bananapanama/). Accessed 8
November 2011.
Rabe, Stephen G. Eisenhower and Latin America: The Foreign Policy of Anticommunism. Chapel Hill:
University of North Carolina Press, 1988.
Read, Robert. “The Growth and Structure of Multinationals in the Banana Export Trade,” in Mark
Casson (ed.), The Growth of International Business. London: Allen and Unwin, 1983.
Redclift, M.R. Agrarian Reform and Peasant Organization on the Ecuadorian Coast. London:
University of London Press, 1978.
Registro Oficial No. 223, Quito, 23 de Julio de 1938.
Riofrío, S. Banana en Cifras . . . y Otras Novedades. Guayaquil: Acción Gráfica, 1995.
Rodríguez-Clare, Andrés. “Multinationals, Linkages, and Economic Development,” American Economic
Review, 86 (1996), pp. 852-873.
Schumpeter, Joseph A. The Theory of Economic Development. Cambridge: Harvard University Press,
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Soluri, John. Banana Cultures: Agriculture, Consumption, and Environmental Change in Honduras and
the United States. Austin: University of Texas Press, 2005.
Striffler, Steve. In the Shadows of State and Capital: The United Fruit Company, Popular Struggle, and
Agrarian Restructuring in Ecuador, 1900-1995. Durham: Duke University Press, 2002.
Thompson, Wallace. Rainbow Countries of Central America. New York: E.P. Dutton, 1926.
Upham-Adams, Frederick. “Conquest of the Tropics: The Story of the Creative Enterprises Conducted
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27
Wigglesworth, J. “’Taura Syndrome’ Hits Ecuador Shrimp Farms,” Fish Farmer, 17 (1994), pp. 30-31.
Wunder, Sven. “Ecuador Goes Bananas: Incremental Technological Change and Forest Loss,” in Arild
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Wallingford: CABI Publishing, 2001.
28
DOUGLAS SOUTHGATE
Department of Agricultural, Environmental, and Development Economics
The Ohio State University, 2120 Fyffe Road, Columbus, OH 43210-1067
Phone: (614) 292-2432
Fax: (614) 292-4749
Email: [email protected]
Education
Ph.D., Agricultural Economics, University of Wisconsin, 1980.
B.S. (Honors; Phi Beta Kappa), Economics, University of Oregon, 1974.
Employment
The Ohio State University, Professor, Department of Agricultural, Environmental, and Development Economics,
1980-present.
Honors, Awards, and Special Appointments
Visiting Researcher, Institute for Agricultural Economics and the Social Sciences in the Tropics and Subtropics,
University of Hohenheim, Stuttgart, Germany, 2011-2012.
International Advisory Board, Panamerican Agricultural School, Zamorano, Honduras, 2010-present.
Adjunct Professor, Department of Applied Economics, National Chung Hsing University, Taichung, Taiwan, 20082010.
Outstanding Service to Students, Ohio State University College of Food, Agricultural, and Environmental Sciences,
2009.
Price Advising Award, Ohio State University College of Food, Agricultural, and Environmental Sciences, 2006.
Pomerene Teaching Award, Ohio State University College of Food, Agricultural, and Environmental Sciences,
2003.
International Award of Merit, Ohio State University chapter of Gamma Sigma Delta, 1999.
Fellow, Instituto de Estrategias Agropecuarias, Quito, Ecuador, 1993.
Joint Career Corps Assignment, U.S. Agency for International Development, Quito, Ecuador, 1990-1993.
Fulbright Research Fellow, Quito, Ecuador, 1987.
Professional Service
Member, Editorial Board, International Journal of Agricultural Resources, Governance, and Ecology,
2000–2008.
Chair, Technical Committee, Sustainable Agriculture and Natural Resource Management Cooperative
Research Support Program, 1999–2003.
Member, Board of Directors, FINCA-Ecuador (microfinance provider), 1997-2003.
Member, Editorial Board, Environment and Development Economics, 1996–2009.
Member, Fulbright Selection Panel, U.S. Institute for International Education, 1996–1998.
Secretary, Vice President, and President, Resource Policy Consortium, 1995–1997.
Member, Tropical Ecosystems Directorate, U.S. Man and the Biosphere Program, 1989–1990.
Service, The Ohio State University
Co-Director, Subsurface Energy Resource Center, 2011-present.
Leader, Departmental Undergraduate Program, 2007-present.
Director, Latin American Studies Program, 1994-1997.
Member, Fulbright Candidate Review Committee, 1995–present.
Member, Environmental Science Graduate Program, 1993–present.
Member, Undergraduate International Studies Program Advisory Committee, 1994–1998.
Member, Center for International Business Education and Research Advisory Committee, 1995–1997.
Member, Provost’s Council for International Activities, 1995–1996.
Member, Foreign Language Resource Center Advisory Committee, 1994–1997.
Courses Taught
Principles of Food and Resource Economics (undergraduate).
Introduction to Latin America (undergraduate).
Global Food Economy (undergraduate).
29
Environmental Economics (undergraduate).
Development Economics (undergraduate).
Latin American Economic Development (undergraduate).
Linea Programming (graduate).
Food, Population, and the Environment (graduate).
Operations Research. (graduate).
Environmental Economics (graduate).
Selected Research (P.I. in all projects except for first two entries in the following list)
Title
Sponsor
Years
Economic Impacts of Shale Development in Ohio
Chamber of Commerce 2011-2012
Making Nature Count in Colombia & Ecuador
MacArthur Foundation
2007-2009
Payments for Watershed Services
USAID
2005-2006
Watershed Development in Ecuador
USAID
2003-2004
Ecuadorian Timber Markets
USAID
1997-1998
Lat. Am. Field Research
Tinker Foundation
1994-1996
Environmental Policy Analysis in Ecuador
USAID
1992-1993
Big Darby Benefit-Cost Analysis
Nature Conservancy
1989-1990
Tropical Forest Management
Noyes Foundation
1986-1989
Budget
$150,000
$250,000
$98,000
$59,000
$75,000
$45,000
$286,000
$20,000
$35,000
Selected Books
Southgate, D., D. Graham, and L. Tweeten. The World Food Economy, second edition. New York: WileyBlackwell, 2011.
Southgate, D. Tropical Forest Conservation: An Economic Analysis of the Alternatives in Latin America. New
York: Oxford University Press, 1998.
Southgate, D. and M. Whitaker. Economic Progress and the Environment: One Developing Country's Policy
Crisis. New York: Oxford University Press, 1994.
Selected Articles
Southgate, D., “National Interests, Multinational Actors, and Petroleum Development in the Ecuadorian Amazon,”
Whitehead Journal of Diplomacy and International Relations, 12:1 (2011) 19-33.
Southgate, D., T. Haab, J. Lundine, and F. Rodríguez. “Payments for Environmental Services and Rural Livelihood
Strategies in Ecuador and Guatemala,” Environment and Development Economics, 15:1 (2010) 21-37.
Rodríguez-Meza, J., D. Southgate, and C. González-Vega. “Rural Poverty, Household Responses to Shocks, and
Agricultural Land Use: Panel Results for El Salvador,” Environment and Development Economics, 9:2
(2004) 225-239.
Southgate, D. and J. Elgegren. "Development of Tropical Timber Resources by Local Communities: A Case Study
from the Peruvian Amazon," Commonwealth Forestry Review, 74:2 (1995) 142-146.
Southgate, D. and H. Clark. "Can Conservation Projects Save Biodiversity in South America?" Ambio, 22:2-3
(1993) 163-166.
Southgate, D. and M. Whitaker. "Promoting Resource Degradation in Latin America: Tropical Deforestation, Soil
Erosion, and Coastal Ecosystem Disturbance in Ecuador," Economic Development and Cultural Change,
40:4 (1992) 787-807.
Southgate, D., R. Sierra, and L. Brown. "A Statistical Analysis of the Causes of Deforestation in Eastern Ecuador,"
World Development, 19:9 (1991) 1145-1151.
Southgate, D. "The Causes of Land Degradation along 'Spontaneously' Expanding Agricultural Frontiers in the
Third World," Land Economics, 66:1 (1990) 93-101.
Graduate Advisees, completed: M. Acosta, J. Arar, D. Azdan, B. Bashaasha, I. Diaz-Rodriguez, S. Lowder, and F.
Rodriguez, all doctorates, plus 19 M.S. students.
International Experience: Consulting in Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic,
Ecuador, El Salvador, Guatemala, Honduras, Peru, St. Kitts-Nevis, Taiwan, Tanzania, Thailand, and Venezuela for
U.S. Agency for International Development, World Bank, Inter-American Development Bank, United Nations,
Chevron Corporation, Ford Foundation, and private clients.
30
LOIS ROBERTS
24694 Upper Trail, Carmel, CA 93923
Phone: (831) 625-5635
Email: [email protected]
Education
Ph.D., Latin American History, University of California at Los Angeles, 1970.
M.A., History, California State University at Northridge, 1961.
B.A., Liberal Arts, California State University at Los Angeles, 1958.
Employment
U.S. Navy Postgraduate School, Adjunct Professor, Department of National Security Affairs, 1992-2005.
Monterey Institute of International Studies, Adjunct Professor, 1989-1991.
California State University at Long Beach, Adjunct Professor, 1981-1986.
California State University at Northridge, Adjunct Professor, 1970-1980.
Honors and Awards
Appreciation Award, Federación Nacional de Cámaras de Bananeros del Ecuador, 2009.
Induction into Academia Nacional de Historia, Ecuador, 2008.
Distinguished Alumni Award, California State University at Northridge, 2001.
Coke Wood Westerners International Book Award, 1988.
Courses Taught
Latin American History, Colonial Period.
Latin American History, National Period.
Latin American History and Culture.
History of Andean Nations.
History of Spain.
U.S. History, Colonial Period.
U.S. History, Early National Period.
U.S. History, Modern Period.
History of California.
Selected Books
Empresarios Ecuatorianos del Banana. Quito: CODEU, 2009.
El Ecuador en la Epoca Cacaotera. Quito: Editorial Universitaria, 1980. Republished in 2010 by CODEU.
The Lebanese in Ecuador: A History of Emerging Leadership. Boulder: Westview Press, 2000.
San Miguel Island: Santa Barbara’s Fourth Island West. Santa Barbara: Cal Rim Books, 1992.
Selected Articles
“The La Purisima Rancho Survey Dispute,” Southern California Quarterly, 70 (Fall 1988) 279-297.
“Sheep Ranching on San Miguel Island,” Southern California Quarterly, 69 (Summer 1987) 103-132.
“Col. William Wells Hollister,” Noticias, 32 (Fall 1986) 42-46.
“The Jesus Maria Rancho, Santa Barbara County,” Southern California Quarterly, 58 (Spring 1986) 1-35.
“Howard Hughes’ Thirty-Five Year Effort to Preserve the Spruce Goose,” American Aviation Historical Society
Journal 30 (Winter 1986) 294-306.
Consulting on Historical Preservation (partial client list)
U.S. Army Corps of Engineers, Los Angeles and Sacramento Districts; U.S. Bureau of Land Management; U.S.
National Park Service; U.S. Navy Engineering Command Western Division; U.S. Ninth District Court of Appeals;
Vandenburg Air Force Base; Los Angeles County; Monterey County; Santa Barbara County; Port of Long Beach;
City of San Juan Capistrano; Monterey Institute of International Studies; Southern California Edison Company;
Union Oil Company.
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