As an account of an important battle for space in the global economy, Banana Wars: The Price of Free Trade, A Caribbean Perspective describes in simple, non-technical language the historical sequence of processes and events that led to the defeat of the African Caribbean and Pacific (ACP) banana exporters in their fight to maintain preferential access to their traditional European markets. The struggle of the ACP producers with the European Union forms the background of the story. In the foreground is the successful campaign by the United States, acting primarily on behalf of Chiquita and other US corporations, against the European Union, which acted, led by the United Kingdom and France, on behalf of its own banana producers and of the producers in their former colonies of the ACP.

The opening salvo of the US campaign was fired in 1972. The United States filed a complaint with the Global Agreement on Trade and Tariffs (GATT) against the “dollar quota” on bananas, which had been part of the post-war mechanism to protect the pound sterling, arguing that such protection was no longer necessary. Nothing came of the complaint, as the issue was settled bilaterally. In 1993, 21 years later, with Chiquita’s support and encouragement, five Latin American countries successfully challenged the compatibility of the restrictive national regimes, and subsequently of Europe’s restrictive common regime, with the rules of the GATT. Three years later, at the behest and on the behalf of Chiquita, the United States—though not a banana producer—lodged a complaint against the European Union’s regime with the GATT’s successor, the World Trade Organization (WTO). By 1999, the WTO dismantled the ACP countries’ preferential access to the EU banana market.

This is an instructive case study in the WTO’s dispute settlement process for many reasons, the most important of which is probably the overarching influence of the WTO in the world economy, which far exceeds that of the GATT. It showed how states may act as proxies for corporations, both in the case of the five Latin American countries lodging complaints with the GATT against the preferential EU regime with the encouragement and support of Chiquita, and in the case of the US action explicitly on behalf of Chiquita. In the latter case, the author provides published evidence to link the US campaign against the EU regime to the financial contributions of Chiquita to the political campaigns of US President Bill Clinton and other senior US politicians.

The case also shows how issues are linked in trade disputes. The struggle against preferences for ACP producers served as a vehicle to increase access to the EU market for other US products, such as hormone-fed beef and, later, genetically modified foods. On the other side, Great Britain won EU approval for its proposed regime by including in the proposal a package of measures with something for each EU member country, especially those who were inclined to oppose the preferential regime.

These incentives were vital to new EU members’ acceptance of the proposed regime. Because these states had no recent history of colonization, the new members felt no moral obligation to grant former British and French colonies preferential access to the EU market and had no financial interest in the well-being of these ex-colonies.

The final lesson here is how the dispute settlement process is stacked against small developing countries, regardless of how vulnerable they are, in favor of powerful developed countries. Both “panel members and Secretariat staff tend to come from the same small pool of [developed] countries.” The Chairman of the panel that ruled against the EU-ACP in favor of the United States was a US citizen. Most telling of all was the expulsion of the legal representatives of the Windward Islands from one of the WTO panel hearings on the grounds that they were not permanent government employees. The implication was that small countries had to be able to afford permanent high-level staff before these countries could participate in disputes that affected them.

While Myers reveals how the US government served the interests of at least one corporation to which it owed political debts, there is unfortunately no equivalent glimpse into the relationship between the EU importing firms and their governments. The author attributes the beginnings of the preferential relationship between Europe and its ex-colonies to Joseph Chamberlain’s turn of the 19th century vision to strengthen the British Empire’s economic relationships with its colonies. Subsequently, Chamberlain’s vision drove imperial economic policy in the aftermath of World War I, when Britain had to repay its US debt. Since then, until the WTO rulings, imperial preference had persisted as a kind of moral obligation to the ACP ex-colonies.

Latin American producers have huge cost advantages in a banana trade without preferential tariff regimes. Myers explains these advantage primarily in terms of “nature and geography.” Larger plantations on higher-quality land benefit from economies of scale in production and transportation. The low cost of labor to Latin American producers is mentioned several times, but Myers never shows how crucial low labor costs are in the comparative advantage of these producers vis-à-vis the ACP. The economic analysis would have benefited from exploring how the factors determined by nature and geography interacted and combined with those determined by society and history.

The plight of the ACP, and in particular of small Caribbean producers like the Windward Islands, is a main concern in the study. They had little representation in the WTO process while bearing the brunt of the adjustment arising from the WTO rulings against the preferential regime on which the banana industry had been built. More generally, there are few options for small island economies in the WTO-governed liberalized global economy.

In the case of the Caribbean, most of the countries have turned to tourism with varying degrees of success. Dominica, perhaps the hardest hit by the loss of the banana market, has been least successful in developing tourism because of the absence of the white sand beaches and the high infrastructural costs of developing such ecotourism services as the “Nature Island.” Other islands have turned to the export of ganja and the trans-shipment of cocaine, inevitably short-run substitutes for the export of bananas. All have to consider niche markets for their traditional products, including bananas. But low volumes of production undermine the viability of agro-industrial processing, such the production of banana chips, and low demand for the products of ILO-compliant labor regimes makes these industries potentially unviable.