Some fruits and vegetables just grow in the tropics. Keeping them available and affordable are often the reasons we keep farmers and developing countries poor.
History of Neocolonialism in Latin America
For Central America, the journey started in 1873 when Minor Cooper Keith started experimenting with bananas in Costa Rica, as means to obtain a cheap source of food for his workers. During the time Keith was constructing a railroad connecting the capital San Jose to Puerto Limon in the Caribbean. Back then, bananas were considered exotic and coffee was the main economic activity in the country. Coffee growing areas were in the Central Valley, while the main market was Europe. A railroad connecting coffee growing areas with the Caribbean port was essential to optimize trade. Particularly since, the Panama Canal wasn’t an option for at least 30 more years.
Unfortunately, Costa Rican government led by Próspero Fernández Oreamuno defaulted the railroad payment and had no other choice but to give Keith in return, 3200 Km2 of free-tax land along the railroad, plus 99 years lease for the train operation. While, the train operation wasn’t necessarily profitable, the rail lines allowed him to move bananas effectively from his several plantations to the Caribbean port, before shipping them to New Orleans where they were distributed throughout the US. The fruit trade proved to be very profitable and the land granted to him by the Costa Rican president, years prior transformed Keith in the owner of 5% of the country’s territory.
Subsequently, Keith founded Tropical Trading and Transport Company, which after partnering with Snyder Banana Company expanded its banana trade empire to Colombia and the rest of Central America as well.
Eventually, due to financial difficulties his company was absorbed by Boston Fruit Company, which at the time, dominated Caribbean’s banana trade. This merge led to the creation of the United Fruit Company in 1899.
Today United Fruit Company is known by the name adopted in 1984, Chiquita brands International.
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The Abuses
Although, the company was recently restructured, it is often used by academics as a well-documented example of exploitative neocolonialism.
Historically, it is well known for bribing government officials in exchange of preferential treatment, exploit their workers, pay as little tax as possible in the countries they run and work ruthlessly to consolidate monopolies. They owned all railroads, the ports, the postal office and were the largest employers and landowner in Central America. They controlled the distribution of land to farmers, their political influence discouraged public construction of infrastructure as well as land reforms, they left vast pieces of land uncultivated while farmers struggled to grow their own food. They intentionally destroyed infrastructure that could potentially benefit the public. Not to mention the environmental degradation, forest destruction and biodiversity devastation that took place to accommodate their massive operations.
Civil war
Furthermore, during 1954, United Fruit Company used its influence in the American Government to invade Guatemala and topple democratic elected president Jacobo Arbenz Guzmán deceitfully claiming his alignment with the Soviet Union. In Fact, United Fruit Company was afraid of Arbenz proposed agrarian reform and new labor code, which would redistribute 40% of the company’s land back to farmers.
The military coup, triggered a deadly 36-year civil war between the US backed up Guatemalan president and leftist insurgents, killing more than 200.000 Guatemalan citizens.
More recently, in 1975 the company claimed guilty after the U.S. Securities and Exchange Commission, which exposed a scheme to bribe Honduran President Oswaldo López Arellano with $1.25 million, in exchange of tax exceptions.
Additionally, in 2007, Chiquita Brands was fined $25 million as part of a settlement with the United States Justice Department for having ties to Colombian paramilitary terrorist groups.
Although, US president Bill Clinton publicly apologized to the Guatemalan nation in 1999 for the atrocities committed by US-Backed up Guatemalan presidents prior and during the civil war. It is undeniable the entire region will keep suffering the consequences of all exploitation, abuses and insidious political intrusion for many decades to come.
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Modern Neocolonialism: Crop Subsidies
Another subtle way industrialized nations, discreetly keep underdeveloped countries poor is by subsidizing crops. In a nutshell, emerging economies are not necessarily technologically developed nor rich in naturals resources. Therefore, one of the few options left to fulfill their economic needs is by trading agriculture products.
However, the US and EU have made the situation difficult for agriculture-based economies, by creating a series of subsidies, meant to help the production of the most important agriculture commodities. As a result, these crops and related products become extremely cheap and abundant, but at the same time unprofitable for any other farmer who is not lucky enough to enjoy local subsidies.
Corn, wheat, cotton, soybean and rice are the most traded agriculture commodities in the world and no other country can compete with the US or the EU in the international market. They spend 22 billion and 65 billion per year respectively subsidizing them. The US have the cheapest corn and wheat in the world, that negatively entails to a massive proliferation of fast food, that led us to a chronic global obesity pandemic.
Despite the adverse health effects, transforming farms into mega-factories have huge environmental consequences. Water misuse, diversity depletion and agricultural pollution of soils and rivers are just a few.
Additionally, developing countries are now importing cheap agriculture commodities instead of producing them, crippling their own agriculture industry in return and subordinating their diet to foreign subsidies of the most basic sources of food.
In Conclusion
Industrialized nations control emerging countries’ economies today as much as during colonial times and their further development hasn’t been and so far, it won’t be on their hands anytime soon.