Gov’t Looking at Adequate Insurance for Banana Industry

With the banana industry under constant threat from hurricanes and other natural events, the Government is looking at an insurance facility for the industry, which would pre-determine the occurrence of natural disasters and make payments on that basis.
The Minister of Agriculture, Dr. Christopher Tufton, who made the disclosure at a meeting with banana farmers at the New Covenant Ministry Church in Highgate, St. Mary earlier this week, said that this particular type of insurance coverage is being experimented with in the Bahamas.
He noted that while the facility might not be able to address all the needs of the industry, it will be able to make more adequate provisions than currently exists.
Citing the Catastrophe Fund, which was established in 2007 to provide compensation to farmers suffering losses as a result of hurricanes and other natural disasters, and the Regional Insurance Fund, Dr. Tufton said the limited assistance provided under these facilities, has forced the Government to examine other insurance options for the sector.
According to the Minister, insurance coverage is necessary for the resuscitation of the banana industry after a disaster, but because of the frequency of hurricanes and the vulnerability of the industry to such events, farmers find it difficult to obtain adequate coverage.
He said the government has always been supportive of the banana industry, and in addition to providing insurance coverage, a US $4 million loan has been secured for export farmers, which will be distributed through the Banana Export Company (BECo).
Dr. Tufton said that without this support, the country was likely to see the end of the export sector, since the Jamaica Producers Group, which controls the majority interest in BECo, felt it was too risky to engage in the re-cultivation of bananas because of the heavy loses over the last three years due to hurricanes.
“The implications of that would mean that we would see the end of export bananas at least for the medium term,” Dr. Tufton said, adding that “there are all sorts of arguments as to how difficult is would be to get back into that business over the long-term, given all the other challenges facing the banana industry”.
He noted that any cessation in the cultivation of export banana would leave hundreds of persons without jobs and present a challenge for small farmers, who, by themselves, would not have the capacity to support exports to Europe.
In addition to the loan, which is being provided by the Development Bank of Jamaica, the European Union Banana Support Programme is also providing US $2 million for the replanting exercise.