Chiquita-owned banana boat, c. 1932
Newsweek’s July 12th issue reported that a boatload of Ecuadorian fruit intercepted by Italian authorities two years ago was part of a larger smuggling ring that realized money was to be made in black-market fruit on the continent, and not – as was originally thought – a one-off incident (perhaps a botched cocaine smuggling operation, where somebody forgot to stuff the fruit full of the drug.) An investigation completed this week reported on the business:
“The trade is big enough now that the Italian authorities are becoming concerned about lost revenue. When officials completed a two-year probe into illicit fruit smuggling this week, they found the trade represented losses of more $80 million in customs fees and more than $2 million in unpaid sales tax on bananas alone.”
The reason? Bananas are highly taxed in Europe, the result of trade laws that favor fruit grown in former colonies, mostly in Africa and the Caribbean. So fruit from Ecuador – the world’s largest banana exporter – comes under restrictive levies. U.S. based-banana companies have been fighting over the taxes for years, but the issue rages on. Chiquita recently adopted an “if you can’t beat ‘em, join ‘em” strategy by announcing it would open new plantations in Africa.
For consumers, the smuggled bananas turned out to be a good deal. investigators helped uncover the extent of the plot by visiting grocers and noticing extraordinarily low prices for the fruit. “We kept wondering how they [the markets] can be selling these Ecuadorean bananas so cheap,” one said. No longer, he added: “That certainly won’t be the case now.”
More on banana trade wars here.
More on Chiquita in Africa here.
Nobel Prize winner Paul Krugman 
omg i had no idea people smuggled bananas! this shocks me! it must be stopped!