Economic Impact

"The principal economic benefit most likely associated with the development of a disease-resistant banana is the reduced cost of production of export bananas through chemical replacement."

The reduction of costs as a result of the Banana Improvement Project could be achieved in many different ways. Some of them are:

Reduced chemical spraying costs
Reduced importation costs of chemicals in banana-exporting countries
Higher yields from banana crops
Better bananas, which results in less waste along the value chain
Lower replacement (as a result of disease) costs
New techniques to reclaim cropland that disease has taken over

Both large plantations and small banana growers should benefit from the Banana Improvement Project. Lower chemical costs will greatly benefit the small local growers who normally cannot afford the expensive chemicals used to ward off banana diseases. Large growers will benefit from the higher productivity that the Banana Improvement Project will cause and be able to grow more bananas on less land.

Furthermore, this project will benefit the banana export industry as a whole. All of these advances will make bananas, which are a very unstable and fragile crop, more stable and increase consumer confidence. Also, a "higher level of food security in banana-consuming countries because of the reduction in chemical use" will result. Both of these will contribute to increasing the success of banana exporting countries.

Analyzing the Impact of the Banana Improvement Project

To understand what exactly the BIP has accomplished is not an easy task. It is hard to put a price on knowledge, which is the main thing the BIP has provided. Still, with some reasonable assumptions, such as when certain technologies will come to pass, it is possible to estimate the rate of return on funds invested for the two different future scenarios. The first scenario is if a disease resistant Cavendish is produced, and the second is if an alternative banana type is discovered. Both of these conservative estimates turned out to be a rate of return on funds invested of at least twenty percent (tables and analysis of these numbers can be found in the Banana Improvement Project Report #2, which is where all this information comes from). These results justify a large investment in banana improvement research.

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