Shortly after Ecuador's National Finance Corporation (CFN) offered lines of credit assistance to banana growers, the Ministry of Agriculture, Livestock, Aquaculture and Fishing (MAGAP) has declared a state of emergency for the sector.

The move was triggered by requests from the industry in the face of very low international prices due to oversupply, waning demand and global economic challenges.

A MAGAP release said the situation had caused an economic 'imbalance' that put Ecuador's banana growers at risk, especially small farmers.

In mid-July President Rafael Correa signed a decree for a new banana trade regulation law, forcing farmers to register authorized growing areas with the government and pay taxes towards competitiveness improvement programs.

MAGAP said the recent emergency declaration is a sign it will give assistance where necessary for banana farmers, while continuing to work on long term solutions and predict future problems the industry could be faced with.

The new measure includes a oversight to help exporters pay the government-set 'fair price' of US$5.50 per 43lbs (19.5kg) box, which was one of the suggestions made by the Ecuador Association of Banana Exporters (AEBE) earlier this month.

"The aim of the new regulation is to monitor compliance with the price set by the government, and that there is respect for contracts between producers and exporters, as in the past six months half of the fruit went out with contracts and paid up to US$4 per box, and there was no regulation to sanction that," said MAGAP.

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