Summary
These two images of the United Fruit Company are direct examples of the rise of Latin America’s export economy. The United Fruit Company was a multinational enterprise that profited from the exportation of mainly bananas grown in Latin America and resold in the United States and Europe. The company controlled vast territories for cultivating tropical fruit and its methods of transportation. It had little competition and maintained a near monopoly in places later dubbed “Banana Republic” such as Guatemala,Honduras and Costa Rica. The term Banana Republic was used as a descriptive term for these countries which were economy dependent on the exportation of food produce.
The United Fruit Company used its economic resources to secure political favors in exchange for building infrastructure, such as railroads and schools in the home countries of the fruit. They controlled most of the agricultural land and as a result of diseases common in bananas, UFCO insisted it required them to hold land, where the cultivating could be moved to once the plague began to spread into land already in use. In order to keep this land reserve away from the citizens of the host country, UFCO had to be politically involved even though it was an American company.Using economic resources it was able to gain political favors, these included lobbying, providing loans to governments in need and backing insurgents. UFCO maintained power through its control over shipping and distribution of bananas in the United States and through its land acquisition in the Caribbean.
The living standard in these places decreased due to the structural corruption of its governments and the dependency on raw exports. Latin America’s focus on the exportation of raw material, through influence of American Companies like the UFCO, decreased its opportunity of economic development. These exports decline over time and force the country to import goods that appreciate, like finished or manufactured goods.
In the first photo above, we see a transportation method of the UFCO. Although it is not a method of transportation, like the railroad mentioned before, it is infrastructure built for the purpose of increasing the production of bananas. We can see the land has been cleared for its harvest as there are bodies of water in the center of the photograph with land with little diversity of plants around it. Large areas of land and marshwaters were often drained to have ample land for the harvest. Once the plague would reach these crops, they would be moved to new virgin land and further fueling the extensive clearing of forests. The amount of bananas that each of the trays can move at a time is a very large amount, as in the first tray a full grown man is sitting in it and being moved along, an example of the mass production of bananas. The fruit that was desired by the American market decreased the natural variety of the fruit as its selling point was its physical appearance. The UFCO was able to regulate the quality and quantity of the fruit being exported into the United States, and thus reducing financial risks.
The second photo is of the construction of the Building of the UFCO, in Limon, Costa Rica. This building demonstrates the infrastructure that was constructed as a result of the economic and political relationship that developed as the company became more connected with the host government. There is a large main building in the center of the photograph, with some smaller buildings on its side still under construction. There are materials scattered around leading into the beginnings of what seems to be a set of railroad tracks. We can infer that this will be an exchange on the part of the United Fruit Company and Costa Rica, where a railroad will be built in exchange for control over shipping and land acquisition. The description on the bottom of the photo, which is in Spanish and English, further confirms the relationship between the Costa Rican government and American businessmen. The construction of this railroad in Limon is an example of monopoly control over indispensable transportation.
Although in the short term, these companies were able to positively affect the lives of Latin Americans through the infrastructure they created the dependent relationship with the United States through its raw exportation. This dependent relationship hinders economic growth by creating vulnerabilities to price shocks, corruption and environmental degradation.
