The United Fruit Company’s Imperial History In Latin America

For decades, the Boston-based conglomerate known as The United Fruit Company (the remnant of which today is Chiquita Banana) was one of the most powerful institutions in Latin America. In Guatemala, United Fruit operated as its own government.

Below, we give a brief timeline of UFCO in Latin America, along with recommended further reading:

United Fruit Company Timeline:

• 1899: United Fruit Company is formed from the merger of Minor C. Keith's banana-trading concerns with Andrew W. Preston's Boston Fruit Company. Within weeks, UFCo acquires seven independent companies that have been operating in Honduras.

• 1901: the government of Guatemala hired the United Fruit Company to manage the country's postal service

• 1904: Guatemalan dictator Manuel Estrada Cabrera grants UFCo a 90 year concession to construct and maintain the country's main rail line from Guatemala City to Puerto Barrios

• 1910: Samuel Zemurray (at this time a UFCo competitor) conspires with the newly exiled General Manuel Bonilla and masterminds a coup d'état against President Dávila. On Christmas Eve, Samuel Zemurray, U.S. General Lee Christmas, and Honduran General Manuel Bonilla boarded Zemurray’s yacht "Hornet" (formerly known as the USS Hornet) with a gang of New Orleans mercenaries and plenty of arms and ammunition. They sailed to Roatan to attack, then seized the northern Honduran ports of Trujillo and La Ceiba. President Dávila was forced to step down, with Francisco Bertrand becoming interim president until General Bonilla handily won the November 1911 Honduran presidential elections.

• 1912: General Bonilla grants the second railroad concession to the Zemurray’s newly incorporated Cuyamel Fruit Company. The period of some of these exclusive railroad land concessions was up to 99 years. 

• 1912: UFCo partners with President Bonilla in the exchange of access and control of Honduran natural resources plus tax and financial incentives. In return, President Bonilla would receive cooperation, protection and a substantial amount of U.S. capital to build a progressive infrastructure in Honduras.

• 1913: United Fruit gets two railway and land concessions in Honduras. They are managed by the company's subsidiaries, the Tela Railroad Company and the Truxillo Railroad Company. These concessions allow the company to begin to produce bananas in large scale in Honduras. Concessions include 162,000 hectares of land from which 71,000 were granted in change of the railroad construction.

• 1913: UFCo creates subsidiary, the Tropical Radio and Telegraph Company, illustrating UFCO's policies of acquiring tax breaks and other benefits from host governments that led to building enclave economies in the regions, in which a company's investment is largely self-contained for its employees and overseas investors and the benefits of the export earnings are not shared with the host country.

• 1924: Guatemalan government grants UFCo a concession for all the uncultivated lands in a 100 kilometer territory.

• 1927: Guatemalan government establishes a $14,000 annual rent for the 100 kilometers it gave to United Fruit in 1924.

• 1928: Incident known as the Banana Massacre, where an army regiment from Bogotá was dispatched by the government to deal with strikers in Colombia (United Fruit workers demanding basic worker’s rights). After issuing a 5 minute warning, soldiers opened fire into a dense Sunday crowd of workers and their families including children, killing at least 47. Whether these troops were sent in at the behest of the United Fruit Company is not clear, but it is clear that the U.S. government was watching the situation closely and communicating directly with UFCo regarding military intervention from Colombia and U.S. government. 

• 1929: After an unsuccessful price war against Zemurray's Cuyamel Fruit Company, United Fruit decides to buy Zemurray out.

• 1936: United Fruit Company signs a 90 year land concession with Guatemala President General Jorge Ubico and opens its second plantation in the country in the region of Tiquisate.

• 1933: Members of UFCo’s board of directors vote to name Zemurray general director of the company.

• 1938: Zemurray becomes President of UFCo.

• 1945: UFCo makes some concessions after a series of strikes from its workers and  President Juan Jose Arevalo of Guatemala pushes United Fruit to improve the working conditions at its plantations. 

• 1947: The Guatemalan government establishes a Labor Code, which UFCo denounces as "Communistic" and threatens to leave Guatemala. The code forces the company to make further concessions to the workers in the strikes that followed.

• 1952: Guatemalan Congress approves President Jacobo Árbenz’s Decree 900, the Agrarian Reform Act. The UFCo denounces it and cries communism. 

• 1953: Under the Agrarian Reform Act, the Árbenz government declares that 209,842 acres of uncultivated lands of United Fruit should be expropriated and distributed to landless peasants. The Guatemalan government promises the company an indemnification of $627,572 in governmental bonds. The value of this indemnification was based on the company's declared tax value of the land. 

• 1953: Zemurray hires several public relations companies to begin an aggressive campaign against Árbenz in the American media.

• 1954: Zemurray publishes a book called "Report on Guatemala" and distributed to Congressmen. It alleged that Árbenz was under Soviet Control, and his Agrarian Reform had been planned in Moscow. 

• 1954, June 18-27: Castillo Armas coup begins. Code-named Operation PBSuccess, a covert operation carried out by the U.S. Central Intelligence Agency (CIA) deposed the democratically elected Guatemalan President Jacobo Árbenz and ended the Guatemalan Revolution of 1944–1954. It installed the military dictatorship of Carlos Castillo Armas, the first in a series of U.S.-backed authoritarian rulers in Guatemala. The entire justification of this coup was the fight against communism, a lie planted in Congress by Zemurray and the UFCo.

• 1954: 94 day general strike in Honduras where hundreds of thousands of workers organized against U.S. companies that included UFCo, its subsidiaries, Standard Fruit, amongst others. U.S. blamed Árbenz and his “communist” followers for instigating. Shortly after the strike is settled, a hurricane hits the Honduran plantations and UFCo fires 10,000 workers.

• 1954: U.S. government files antitrust suit against UFCo

• 1958: Antitrust suit is settled. UFCo agrees to sign a consent decrees that allows the company to admit to no wrongdoing but still allows the government to force several important changes to the structure of the company. The largest change facing the company is that it has to carve out a competitor, from its own holding, by 1970, will be one third of its current size. 

• 1958: UFCo acquires the rights to explore petroleum and natural gas in Colombia, Panama, and Ecuador.

• 1959: Fidel Castro begins his agrarian reform and seizes the sugar properties of United Fruit in Cuba.

• 1960: Castro accuses UFCo of aiding Cuban exiles and supporters of former leader Fulgencio Batista in initiating a seaborne invasion of Cuba directed from the United States. Castro warned the U.S. that "Cuba is not another Guatemala" in one of many combative diplomatic exchanges before the failed Bay of Pigs Invasion of 1961.

• 1969: Eli Black makes the third largest transaction in Wall Street history up to that moment by buying 733,000 shares of United Fruit in a single day. Black becomes the largest shareholder of the company.

• 1970: Struggling United Fruit becomes United Brands

• 1971: United Brands reports a loss of 24 million dollars; the highest in its history. The same year, Jacobo Árbenz dies in exile in Mexico City at the age of fifty-eight.

• 1974: The governments of Honduras, Costa Rica, and Panama sign the Panama Agreement which imposes banana export taxes of $1 per 40 pound box. United Brands considers this new tax unfair and confronts the local governments.

• 1974: The governments of Costa Rica, Colombia, Honduras, Guatemala, and Panama form the Union de Paises Exportadores de Banano (UPEB)––Organization of Banana Export Countries––to defend the interests of the member countries, raise and maintain high prices, and adopt common policies. United Brands threatened unsuccessfully to pull out. 

• 1974: Black sells UFCo to Foster Grant for almost $70 million.

• 1975: Black commits suicide by jumping from his office in Panam building in New York. The investigations following his death reveal a bribery scandal in which Black and United Brands are involved. In April, the SEC accused United Brands of bribing the President of Honduras, Osvaldo Lopez Arellano with $1.25 million, with the promise of another $1.25 million later, in exchange for a reduction in the export taxes Honduras committed under the light of UPEB rules. The investigation also reveals that during Black's presidency United Brands had bribed European officials for $750,000.

• 1975: Honduran Army removes the President on suspicion of participating in the UFCo bribe, despite Lopez allegations of innocence. 

• 1975: Costa Rican President threatens United Brands with a cancellation of all contracts if the company does not reveal all the names of local officials involved in bribes. 

• 1975: A federal grand jury brings criminal charges against United Brands in the United States.

• 1978: United Brands admits that it paid a bribe of $2.5 million to the former Honduran minister of economy, Abraham Bennaton Ramos. The company is fined with $15,000 and the case is closed.

• 1993: Banana trade dispute with European Union begins. The EU establishes a quota system for banana imports giving preference to those produced in their former colonies in Africa and the Caribbean.

• 1994: Chiquita Banana (formerly United Brands) accuses the European Union quota policy as unfair. Senator Robert Dole takes up the cause in the U.S. Senate, saying that the European initiative was going against the most basic rules of free market and proposed retaliation. During his presidential campaign against President Bill Clinton, Senator Dole received a $155,000 contribution from Chiquita and used a company airplane for his campaign tour around the United States.

• 1998: The United States protests at the World Trade Organization against the new European policy around bananas, and threatens to slap 100% tariffs on several European products unless the European Union stops its preferential treatment for Caribbean, African, and Pacific producers. The European Union claims that the American demand does not make sense because its policies did not affect a single American job. European Union's trade commissioner, Sir Leon Brittan claims that the sanctions are a product of the strong lobby of Chiquita and Dole.

• 1999-2000: The trade war between the U.S. and the EU escalate, eventually ending up at WTO court, who ruled in favor of the U.S.

• 2001: U.S. and EU agree on a deal to end the banana trade war. The U.S. drops the economic sanctions and the Europeans drop their first-come-first-served import system and replace it for a transitional system that will lead to a tariff-only system in 2006.

Special thanks to unitedfruit.org for supplying much of this information.

To dig deeper into United Fruit’s history, we recommend checking these books out:

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