Dominica Banana Company

PES covers the period 9/82-2/85 and is based on document review and interviews with key representatives of the Government of Dominica and the Dominica Banana Marketing Corporation (DBMC). Substantial progress has been made towards meeitng project objectives; policy and operational changes and performance targets have been achieved. First, the former Dominica Banana Grower"s Association (DBGA) was restructured in 6/84 to provide for a commercially-oriented Dominica Banana Marketing Corporation and a separate representational association for banana growers. The internal management of the DBMC has been streamlined, strengthened, and greatly improved in efficiency. Secondly, since 1982 the financial performance of the DBGA/DBMC has improved significantly. Export production has increased by 15%, operating costs have decreased by 15%, administrative and financial expenses have been reduced, and the DBMC is now realizing a profit on its distribution of grower inputs. Finally, notable progress has been made with the divestiture of boxing plants through increased field packing by individual farmers. Despite these substantial managerial and financial improvements, DBMC"s progress in becoming a more cost-effective organization has been hampered by the declining value of the pound sterling. Because of this decline, as well as a long-term debt burden, DBMC remains in a precarious position; it must maintain the lowest possible operating cost positions, restructure its debt payments, and increase production in order to achieve sustained financial viability. Actions to be undertaken include: (1) formulation of budgets for 1985 and 1986 based on realistic exchange rates and grower prices; (2) discussions with the commercial banks to reschedule loan repayments coming due; (3) discussions with the British Development Division about refinancing the commercial bank loans; and (4) a decision by the Regional Development Office whether to reprogram funds to provide increased inputs for the control of banana disease, with appropriate amendment of the grant agreement.