Memo to Chiquita Brands International
1757 words 8 pagesMEMO
To: Chiquita Brands International
Introduction: For the subject choosing a strategy to overcome effects of EU’s banana policy, I have gone through the whole issue of EU’s banana policy and its effects on the banana business of Latin America in general and Chiquita Brands International in particular. I have also analyzed the way the whole issue has been approached by the company and tried to formulate a plan that may prove successful for the company. Since the present problem is a serious nature threatening the existence of a big player in the banana market, I have tried to go back to history of the company of highly political nature of the international policy making in this trade. I have tried to understand the role of …show more content…
This has rather opened an opportunity for companies to foray into new production sites and develop those nations as Chiquita helped developing Latin American economies through its business empire.
Company’s approach to EU’s Banana Policy
Since the company, throughout its history, has enjoyed political support in the Latin American region and the US, Keith E. Lindner’s approach to solve the problem through political channels seems quite obvious. Instead of taking proactive action in securing its position in EU markets by securing more licenses or creating new production base in EU preferred regions, company depended more on political links. However, the political power came under suspicion as EU prevented attempts of a strong GATT petition by dividing Latin American region by signing a Framework Agreement with a couple of nations and giving them better access to European markets. This should be considered as a political disaster for the company as it further restricted the company’s business in European region. Lindner filed section 301 petition with USTR only after the company had already lost a sizable market share to its competitors in the European region. Although the step was in the right direction but it was too late.
Instead of directly going for asking for action against Latin American signatories to the