A rainy Sunday game of Trivial Pursuit provided the claim that bananas are the fourth most important food commodity after rice, wheat and maize in terms of production value. This UN report confirms the fact.

And that reminded me of an article in the Journal of The Institute of Economic Affairs, Fair trade is counterproductive – and unfair by David R. Henderson. In the article, Henderson writes:

There is a Fair Trade mark for bananas as well as for coffee [the focus of the article]. As I noted earlier, to have your product qualify for Fair Trade, you must not use genetic modification. That could matter a lot for bananas and in a negative way.

Henderson then explains Dan Koeppel’s Banana: The Fate of the Fruit that Changed the World:

  • The banana is threatened with extinction.
  • Two generations ago, Gros Michel was the most common variety.
  • Gros Michel was wiped out by Panama disease.
  • Cavendish is now the most common variety but it too is threatened.
  • Genetic engineering is the best hope for a hardy banana.
  • If genetic engineering succeeds, there is a strong chance people will not — or will not be allowed to — eat GM bananas.
  • The genes which scientists are trying to insert are common.

Bananas? Seems amusing, right? We could live without them? But Koeppel claims that in many parts of the world, bananas, more than rice or potatoes, are what keep hundreds of millions of people alive.

Henderson points out the irony of Koeppel’s position in support of Fair Trade: Koeppel does not seem to have read the Fair Trade standards. Sections 3.6 and read:

Producers do not use GMOs in either the production or processing of products.

Genetically engineered seed or planting stock should not be used. If certain members or parts of the organization produce products that are not destined for Fairtrade labelling, none of those products may be GMOs.

So, is Fair Trade desirable in respect of bananas? 

Fair Trade, to the extent it is successful, will discourage people from pursuing the solution to Panama disease that is most likely to work. And that could wreak havoc with the lives of hundreds of millions of the world’s poor. 

And, while we might argue that this multitude will not allow Europeans to dictate what they may eat, the issue may meet the same problem as the malaria vaccine. That is, companies may not be willing to invest in a market where people cannot cover the cost of the necessary research.

The conclusion of the article, for this and other reasons? The best way, the fairest way, to help people is to eliminate trade barriers.

The Journal costs £7.50 here.

Comments are closed.