Banana industry continues to reel from rebel attacks

MANILA, Philippines - Despite ongoing peace talks between the government and rebel groups, the billion-dollar banana industry continues to be hampered by attacks in Mindanao, where the biggest banana plantations are located.

Banana stakeholders said the ceasefire was not doing any good for most plantations and other agricultural businesses.

The continued attacks of the New People’s Army (NPA) rebels have been affecting the banana industry following the shutdown of operations of some banana companies in Mindanao.

Stakeholders said NPA rebels were extorting money from companies, ranging from as low as P5,000 to as high as P5 million per month.

“If we pay, we will lose our shirts and will be forced to close shop; if we refuse to pay, our lives and that of our family members will be in danger,” said a banana stakeholder who requested not to be named.

The NPAs are allegedly asking for commission ranging from five to 10 percent from private contractors doing multi-million peso projects for the government and private companies.

Industry stakeholders have been seeking government support in fighting extortionists from rebel groups who are demanding revolutionary taxes.

Apart from this, agrarian reform beneficiaries (ARBs), who are now contract growers for banana and pineapple exporters, have reported increased attacks by the NPA on farms, facilities and equipment.

A division of Dole Philippines Inc., the country’s pioneer banana exporter, has indefinitely closed its operations in Surigao del Sur after being subjected to NPA attacks for refusing to pay revolutionary taxes.

The NPA has burned 19 container trucks, resulting in P20 million in net loss for the company and affecting over 1,500 employees in its 400-hectare plantation.

Stakeholders earlier said proper attention should be given to insurgency problem as it will likely drive present and prospective investors away, leading to closure of plantations that will eventually lead to unemployment and poverty.

In fact, NPA attacks for the first few months of the year have already surpassed the total attacks for the whole of 2015, which involved arson, extortion, harassment, black propaganda, infiltration of labor unions, and meddling with agribusiness venture agreements, among others.

The situation in Mindanao is expected to worsen when multinationals start to pack up and leave for other countries to grab the lucrative fruit export market in Asia and the Middle East from Mindanao exporters.

Data from shipping lines that carry agricultural exports from Mindanao showed that banana exports account for more than 60 percent of the total volume shipped out of island.

Banana plantations in Mindanao account for 83,000 hectares, employ over 300,000 workers, and support almost two million individuals.

The local banana industry is starting to wear down as it slowly slips its rank among the largest banana exporting countries globally and the comparative advantage and competitiveness of the Philippines in banana production are slowly eroding.

Based on a recent United Nations Conference on Trade and Development report, Costa Rica has overtaken the Philippines as the number two largest banana exporting country.

The Philippines used to be the second largest producer of bananas worldwide, next to Ecuador, that supplies 95 percent of the total banana demand for the Asian market.

Reports showed that the country’s export earnings from banana plummeted to $440 million last year from $1.1 billion in 2014.