We will actually bear witness to a live and full-scale experiment, and suffer the consequences. The question we would ask is as follows: what will be the effects on the value chain of a fall in customs duty of a half-euro per box on Ecuadorian banana exports to the EU? Potentially, and in very conventional terms, the five links in the chain – producers, exporters, importers/ripeners, distributors and consumers – could benefit from this revaluation. But we should not jump the gun by contemplating the effects of this reduction solely in terms of redistribution. The industry would need to prove itself highly adult and responsible to share the 3 to 5 % bonus on the import price, for example, with its producers or its labourers, i.e. its weakest links. Quite the contrary, we can bet that this surplus will not benefit anyone, since according to many downstream operators, they have already incorporated this reduction into their negotiations with the supermarket sector for 2017. For their part, Ecuadorian producers have just started the half-yearly negotiations on minimum price, and are claiming the bonus in full. Yet the exporters of course have a completely different strategy: cut their sale price to restore their competitiveness. So in the end, there is every chance that the added value on the fruit can be cut by another 50 eurocents, across all the operators and industries. Since Aldi and co., in their annual contracts, make no distinction between an Ecuadorian banana and a Colombian or Ivorian banana. But I almost forgot about the consumer who, if the distributors passed on the fall in the price of the raw material, could see get their bananas even cheaper: which would be a great victory for European purchasing power. Hang on though: cheaper than cheap means practically free, right?
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