October 26th 2009, Banana Link

The world's biggest banana exporter has started the process of setting up a state banana exporting company.  In his weekly broadcast to the media, President Rafael Correa said he was fed up with the abuses by companies in the sector who underpay producers and avoid taxes: "The definitive solution is to create a state marketing company and we are already in the process of doing so".

Correa added that the idea is to fix "clear rules" for marketing the fruit. The government has also taken action to toughen the sanctions on unregistered exporters and those who fail to use the banking system to pay producers the legal minimum reference price. Correa added that producers also have their share of responsibility and should sign contracts with exporters in order to secure better prices.
 
The Exporters' Association (AEBE) reacted by warning that this proposal would be "the tip of the iceberg that spells the creation of state enterprises that compete with private companies". AEBE president Eduaro Ledesma warned that creating a state exporter would be tantamount to communism. He also encouraged the Association's members to sign contracts with producers, since the world market price is considerably less advantageous.
 
However, for Jorge Toapanta, spokesperson for small producers mainly concentrated in El Oro province, a state exporter is the only viable mechanism that would enable growers to "liberate themselves from the yoke of unscrupulous exporters".

Ecuador's banana trade generated US $840 million in export income in the first five months of 2009.
 
Sources: El Comercio, Quito; Metroquil, Guayaquil; El Universo, Guayaquil; Diario Expreso, Guayaquil.