Fruit importer Fyffes has stopped buying bananas from the biggest producer in Belize because of its links to a local businessman named by US authorities as a drugs kingpin.
Fyffes confirmed yesterday that it ceased buying bananas from Mayan King in Dangriga, Belize, because Mr Zabaneh has been acting as a spokesman for its owner, Meridian Farms, which is in crisis following a drought.
"Given recent developments where John Zabaneh appeared to speak on behalf of Meridian Farms, Fyffes immediately ceased purchase of bananas from the farms in question," it said in a statement yesterday.
It added that the Banana Growers’ Association, the local body through which it buys fruit from the Central American country, had confirmed this to the Meridian group of farms.
Under the country's Kingpin Act, the US treasury department in 2012 named Mr Zabaneh as a narcotics trafficker with ties to Mexican drugs baron Joaquin "Chapo" Guzman, his Sinaloa Cartel and Colombian suppliers.
The Foreign Narcotics Kingpin Designation Act bans US citizens and organisations from doing business with any person or company that the authorities identify.
Mr Zabaneh has always denied this but failed in his efforts to get the treasury department to lift the designation. He has admitted that he was convited of a minor “marijuana-related” offence in the US during the 80s, but also claims that he learned from the mistake.
Fyffes said it severed links with Mr Zabaneh and his interests in 2012 when the treasury department’s office of foreign assets control named him under the legislation.
However, the Irish company reinstated Mayan King as a supplier after the growers’ association assured it that Mr Zabaneh was no longer involved in it and a company unconnected with him, Meridian Farms, had taken control of the business.
Fyffes yesterday dismissed local media reports that it had given financial aid to Mr Zabaneh or the farms, which suffered poor harvests this year as a result of the drought and are struggling with cash flow problems.
He told a Belize news channel days ago that Fyffes had offered bridging finance to help him bail the operation out of its current difficulties.
Mr Zabaneh was not available more recently when journalists attempted to contact him to question him on the news that Fyffes is no longer buying from the Maya King farms.
Fyffes also denied that it is providing direct support, such as soup kitchens, to the workers. Local media estimate that 1,200 people work on the banana farms.
Mayan King is responsible for around one quarter of Belize’s banana exports. The Banana Growers’ Association acts as the sole exporter for the fruit.
Meanwhile, Fyffes said yesterday that it is spending $30 million on buying 2,500 hectares in Central Americ that will boost its capacity to supplies melons in the US . It is also buying a Costa Rica banana farm for $15 million.
Fyffes said that it has closed to its defined benefit pension scheme to future accruals and liabilities with a once-off €20 million payment. The move will add €1 million a-year to operating profits. The payment was €10.5 million more than the pension-fund deficit on the balance sheet at the end of June.