The Ecuadorian government has decided to suspend the collection of contributions from the banana industry, worth 0.7% of total export values and designed in 1994 to support the National Banana Program.
Association of Ecuadorian Banana Exporters (AEBE) executive director Eduardo Ledesma told www.freshfruitportal.com the program actually disappeared in 1998, with the proceeds going to another government agency Corpecuador until it was dismantled by president Rafael Correa recently.
“We have been fighting for many years for the suspension of this tax that was created for the National Banana Program, that was then removed. Afterwards, this contribution went to form part of Corpecuador to rebuild the country’s highways affected by the El Niño phenomenon,” Ledesma said.
“Supposedly, they were going to turn over to the activities of the country, but unfortunately the banana [industry] was left alone until two or three years ago when president Correa removed Corpecuador.”
The AEBE’s efforts bore fruit when the Ministry of Agriculture, Livestock, Aquaculture and Fishing announced the measure, coming into force on Sep. 11.
“After this constant insistence on restoring value to the export sector, the Agriculture Minister, aware of the loss in competitiveness for the banana and at our constant insistence, managed to remove this tax.
“This will mainly benefit exporters because, because it’s a fund that they take from their pocket and that now they won’t have to pay any more.”
He said this tax ranged between US$12 million and US$15 million annually, which is money that companies would now maintain.
“This is something that is totally favorable for the industry because it enables more liquidity for the export sector and fewer costs for Ecuadorian bananas.”