Contract growers of export bananas in the Philippines are considering ways to regain sales lost to Iran because of the difficulties Iranian importers have raising letters of credit (L/Cs).

If the growers are unable to find an alternative way to arrange payments for sales into to the lucrative Iranian market, they will look to other countries to find new buyers.

Oil for bananas

Iran is the biggest customer in the Middle East for bananas from the Philippines.

However, according to industry figures, business with the Islamic republic has been increasingly difficult since international sanctions imposed on Iran have made L/Cs hard to come by.

One idea put forward by the Filipino Banana Growers and Exporters Association (FBGEA) is to explore the possibility of bartering bananas from the Philippines against Iranian oil.

Livelihoods at risk

Another option is for the banana growers to try and break into new markets, and they may specifically target Australia as a potential export market.

This is an important issue in the Philippines because, according to the PBGEA, earnings from banana exports to Iran sustain the livelihood of around 36,000 workers.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.