Beyond Trafficking and Slavery

Supply chains roundtable: COLISBA

COLISBA: Latin American Banana Unions
26 June 2016

Question 2 – what should global supply chain governance look like?

Unions, together with our allies, insist on the need to put an end to the ‘race to the bottom’. As a step towards this end, and to improve balance in supply chain relations, we consider it necessary that supermarkets contribute significantly to the solution. They need to promote an increase in banana prices so that workers can access a living wage. This can be a achieved if we develop a monitoring tool to ensure that the price increase is reflected in collective contracts, in which there are unions negotiating for better working conditions, where they currently do not exist. These workers must have the freedom to organise and to negotiate a collective bargaining agreement. This monitoring system can be tripartite between supermarkets, workers and businesses, incentivising companies that comply with the rights of workers by securing for them better prices in the supermarkets.

Question 5 – what are the benefits and drawbacks of global supply chains as a 'model' for production and development?

In the last 15 years, the international banana market has been increasingly squeezed by low prices. Of the net proceeds from the sale of a kilo or box of bananas, only between 0.70% and 1% goes to workers. This is barely enough for subsistence. It is not enough to achieve a living wage, nor decent work, as understood by the ILO. The price set for a box of bananas makes it impossible to pay better wages and give guarantees to workers. 

In commercial contracts it says that the buyer can withdraw their contract at any time if the profit margin is not sufficiently high. The economic costs of these provisions fall on national or independent producers, small producers, and at the end of the chain on the workers, who always bear the brunt. What is clear is that business practices end up worsening unequal relationships between buyers, producers and workers, due to the power inequities inherent in global supply chains. Those in charge are those who have the purchasing power in negotiations.

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