The DR-CAFTA agreement will require cheaper processes of production and marketing as well as lowering other costs that are twice what the country’s leading competitors are paying, if the current level of exports to the United States are to be maintained.
Flying in the face of recent studies by the Word Bank, other studies carried out by the Probanana group (Project for Competitive Bananas) indicate that local production has backward technology that reduces productivity and earnings. Fully 19% of the farms lack “infrastructures” needed to produce top grade fruit. In some areas the percentage of farms lacking equipment, roads and buildings adequate for banana production reaches 43%, as in the Southeast.
There are 400 shippers that are supplied by 58% of the farms in the Cibao Valley and 20% of the farms in the south. Most of the farms do not have washing sheds needed to clean the fruit, and just 10% have cable systems for moving fruit from the tree to the packing sheds. For Pilar Ramirez of the Inter-American Institute for Agricultural Cooperation, the US is practically a closed market, in the hands of countries that are more competitive than the DR. According to her, the Dominican Republic “exports taxes, since to export a box of bananas a person has to talk to ten different government institutions.” She cited as an example that a cable system for moving fruit around a farm costs a Dominican farmer as much as 40% in import duties.