Banana republic the beginning
Costa Rica is a small country in Central America. The rapid development of the coffee business in the early 19th century led to major changes in the economic development of the country. With the growth of coffee production, the need for a more developed infrastructure increased (at that time, oxcart was the main transport in the country). The Costa Rican government tried almost unsuccessfully to establish the country's infrastructure throughout the 19th century and until the middle of the 20th century. The first railway, El Burrocarril, which means Donkey Road, was completed in 1857. This 9-mile animal-drawn railroad only ran for a couple of years because it couldn't compete with an ox-cart, which was cheaper and faster (the speed of the train pulled by mule was about 2 miles per hour).
Minor Cooper Keith (who later played an important role in the history of the region), along with two of his brothers and their uncle Henry Meiggs, who signed the contract with the government of Costa Rica, began construction of the railroad from San Jose (the capital city of Costa Rica) to port Limon in 1871. During the first twenty-five miles of construction, Henry Meiggs, along with Keith's brothers and 5,000 other men working on the construction, died of malaria and harsh working conditions, leaving Minor Cooper Keith in charge of the project.
In 1882, when the seventy miles of the railroad were built, the Costa Rican government depleted its financial resources and could no longer pay. To complete the project, the government struck a deal with Minor Keith. He was to bear the costs of the rest of the project and in return receive 800,000 acres of tax-free land along the railroad and all the profits from the newly built railroad for the next 99 years. To complete the railroad, Keith had to take out a £ 1.2 million loan from several banks as well as private investors.
When the railway was completed, it became apparent that there were not enough passengers or cargo to use it at full capacity. Keith had to pay for the railroad's operating expenses as well as the huge loan he received. He started experimenting with different business ideas to raise money, and one idea was very successful. During construction work, Keith ordered banana trees to be planted along the railroad. Bananas were used to feed workers during hard times, and now he wanted to try exporting them using the newly built railroad. By 1890, the railroad was used only to transport bananas to the port of Leon, and the new banana business surpassed the cost of the railroad itself.
What began as a loan waiver experiment has grown to become the largest banana trading company in Central America and Colombia. In 1899, the company was merged with the Boston Fruit Company to form the United Fruit Company, today known as Chiquita Brands International.