COMMITTEE ON COMMODITY PROBLEMS

INTERGOVERNMENTAL GROUP ON BANANAS AND
ON TROPICAL FRUITS

First Session

Gold Coast, Australia, 4-8 May 1999

STRATEGY FOR IMPROVEMENT AND DEVELOPMENT OF BANANAS FOR THE COMMON FUND FOR COMMODITIES

Table of Contents

INTRODUCTION

1. This document contains the overall Strategy for the Improvement and Development of Bananas adopted by the Intergovernmental Group on Bananas at its Fifteenth Session (Rome, 7-9 May 1997). This strategy is intended to provide the wider context within which specific development projects seeking financing from the Common Fund for Commodities (CFC), and submitted to the Sub-Group for its endorsement, are to be considered.

2. The Sub-Group should note that specific project proposals emanating from it will be considered by the CFC not only in the context of the overall strategy, but also in relation to the priorities for project financing and the criteria which have evolved in the CFC to maximize the impact of its operations. For instance, the CFC has tended to favour projects expected inter alia to have an early measurable impact, which command sizeable co-financing resources and which have a potential to benefit least developed countries. The CFC also welcomes projects which have a loan-financing component.

THE OVERALL STRATEGY FOR THE IMPROVEMENT
AND DEVELOPMENT OF BANANAS

FOSTERING MARKET EXPANSION AND EXPORT DIVERSIFICATION

3. A major component of the strategy is to increase the economic viability and sustainability of the global banana economy through the expansion of demand for bananas, particularly in new and potential growth markets, and/or through the provision of a flexible, well-informed and competitive economic environment conducive to an efficient allocation of resources. A larger demand base translates into higher prices and higher returns to producers and marketing operators, from the farm gate to the retail outlet, while the appropriate economic environment facilitates the movement of resources in or out of banana production and trade, from or into other sectors, when appropriate. The issues of market expansion and diversification have been identified by the Sub-Group as being of high importance to the future of the commodity. Within this priority, programmes may aim at:

4. In fostering market expansion there is a need for parallel improvement/development in the following areas:

IMPROVED MARKET TRANSPARENCY

5. Improved market transparency, including market information and research on the structure and functioning of existing, new, and potential growth markets, is necessary for eliminating distortions which cause an inefficient allocation of resources, and also for risk management. Through this, competitiveness could be improved and a better balance between supply and demand achieved. Measures for achieving this objective could include:

DEVELOPMENT, DISSEMINATION AND IMPLEMENTATION
OF NEW TECHNOLOGY

6. In an increasingly competitive environment, the development, dissemination and implementation of new technologies and improved management practices are of paramount importance. Programmes may therefore be needed aimed at: