Madeira Islands and Development (MADEIRA)
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CASE NUMBER: 330
CASE MNEMONIC: MADEIRA
CASE NAME: Madeira Islands and Development
A. Identification
1. The Issue
Since 1986, the Portuguese archipelago island of Madeira has
been admitted into the European Community and has been
apportioned structural fund monies for modernization programs.
Madeira is being turned into an off-shore tourist/business
center. Because of the recent rapid economic growth on Madeira,
environmental problems such as air, ground, noise, traffic and
tourist pollution, is causing tension among the traditional-
minded older peoples who desire to keep Madeira as a small-farm
community, and the entrepreneurial-minded younger people who
sense advantage from the promises of tourism. Also, the new
economic advancements threaten the Madeiran-limited habitat of
such species as the Madeiran storm petrel (bird), in which there
only are an estimated 30 pairs alive on Madeira. EU plans to
modernize Madeira continue, and many feel the environmental
stability as well as the once-insulated culture of the Madeirans
will continue to be threatened.
2. Description
Up until 1986, life on the Portuguese island of Madeira had
been, for the most part, based on self-subsistence, small-scale
farming. Being blessed with fertile lands, Madeirans were able
to grow many kinds of crops for their own consumption without the
need to trade with the outside. In 1986, however, when Portugal
joined the European Community, the opportunities for Madeiran
prosperity increased. In the ensuing years, changes would take
place that many of the traditional-mind would come to dislike.
The pace of economic change increased on the island of
Madeira in 1992 with the EC implementation of the structural
fund, POSEIMA (Program of Options for the Remoteness and
Insularity of Madeira and the Azores). The fund has allocated
more than $400 Million (US) to revamp the Madeiran infrastructure
including modernization of roads, bridges, buildings, health
clinics and communications. POSEIMA was part of the European
mission of bringing the remote and backward economies of the
Community closer to the more prosperous continental economies.
Though economically the POSEIMA program is said to be a
success, cultural problems have been created because of the
program. Part of the POSEIMA plan is to give aid for
agricultural improvements. The agricultural sectors, however,
have been transformed. The once small-farming and practically
self-subsistent technique has given way to export viticulture,
especially grapes for Madeiran wine and bananas. Though most of
the farms are still small, as compared to the rest of Europe or
the US, many of the farmers feel threatened that their small-farm
way of life will be lost to the perils of competitive
agriculture. For example, if the banana regime installed by the
EU in July, 1993 is eradicated, cheaper, Latin American "dollar"
bananas would be imported into the EU and the Madeiran share of
25,000 tons of bananas exported to the EU would be lost. They
would be forced to look for agricultural export alternatives--the
alternatives being very few, according to the farmers.
For the meantime, the Madeiran small-farm seems to be
protected by EU policy, but there have developed other cultural
and environmental problems stemming from the POSEIMA project. As
mentioned earlier, much of the infrastructure on Madeira is being
modernized. But the modernization projects have created a
cultural rift between the older-traditional and the young-
entrepreneurial Madeirans. Culturally, the older generations are
afraid that the turning of Madeira into an off-shore
international business/tourist resort will change the
traditionally quiet and subsistent life style of the Madeirans
into an island that caters to the foreign tourists. The younger
generation, much of which has been educated on the European
continent or in the US, senses the opportunity of prosperity, and
favors the modernization of Madeira.
The modernization of Madeira has created environmental
problems. For example, the number of cars imported from Europe
has increased greatly (the average increase per year of car
imports for the tiny island of 250,000 is 3,600 cars a year) and
there is no way of disposing of older, junk cars. Many cars have
turned up in the fields of farmers. Also, trash from the growing
business and tourist industries cannot be disposed of easily
because there is little vacant space on Madeira (Madeira's
habitable areas--ie. Funchal--are the most densely populated
areas in all of the EU). For now, trash is piled higher in the
few trash dumps that exist, but they are nearing capacity. This
problem seems to be inviting other environmental problems such as
soil or water contamination for which the Madeirans are not
prepared.
Ecologically, many ornithologists fear that if such rapid
economic advances continue, some species, such as the Madeiran
storm petrel (of which there about 30 pairs left) could become
extinct. Also, Madeira is known for its pristine landscape
including waterfalls and lavish mountains. If more buildings and
apartment complexes are built, these wonders could be lost
forever. Since the European Commission agreed in December 1994
that modernization in Madeira was on course, and it approved new
POSEIMA structural funds for the next several years, it appears
as though there may be more environmental as well as cultural
problems to come.
3. Related Cases
GALAPAGOS Case
CUBA Case
BALI Case
JAMTOUR Case
Keyword Clusters
(1):Domain= EUROPE
(2):Forum= Portugal
(3):Effect= SCALE
4. Draft Author: Todd M. Porter (December, 1994)
B. LEGAL Filters
5. Discourse and Status: AGReement and INPROGress
6. Forum and Scope: EU and Regional
7. Legal Standing: TREATY
The POSEIMA program has its original authority from the
Treaty of Rome, so treaty is applicable. Also, any laws agreed
to at the community-level are applicable to each of the states
and within the states, so POSEIMA is subject to EC, Portuguese
and local Madeiran law, all deriving from the original treaty,
which Portugal, including Madeira, agreed to in 1986.)
C. GEOGRAPHIC FILTERS
9. Geography
Continental domain: Europe
Geographic site: Southern Europe
Geographic Impact: Portugal
10. Sub-National factors: YES
11. Type of Habitat: Tropical
IV. TRADE FILTERS
12. Type of Measure: Subsidy
The POSEIMA project is loaded with subsidies (although
called structural and regional funds) for Madeiran agriculture as
well as being part of the Lom‚ Conventions. Also, the POSEIMA
funds for rebuilding the Madeiran infrastructure are regulated
with guidelines to make the infrastructure of Madeira more
compatible with the infrastructure of the rest of the EU.
13. Direct v. Indirect Impact: Indirect
Direct and Indirect (The admission of Portugal in the EC and
the POSEIMA program both have had direct impact on trade for
Madeira. There are, however, indirect impacts such as the older
generations' desire to keep Madeira the way it once was as well
as the influences of international agricultural markets on
Madeiran exports to mainland Europe, especially bananas).
14. Relation of Measure to Impact
Directly related: NO
Indirectly related YES
Not related: No.
Process: YES. Habitat
15 Trade Product Identification: Tourism
16. Economic Data
-The Madeiran GDP/capita is 30 percent of the average EC
citizen and is only 60 percent of that of the average mainland
Portuguese.
-Madeiran population: est. 253,000
-unemployment: avg. < 5%
-POSEIMA funds to date: $400 Million
-Bananas contribute to 45% of the total exports
-Agriculture employs nearly 21% of the workforce
17. Degree of Competitive Impact: Low
The POSEIMA program has helped Madeiran trade stay competitive
through the structural funds and the Lom‚ conventions. Instead
of having an adversarial affect, POSEIMA and Lom‚ have helped to
increase trade on the island. Some say that without the
agreement and the fund, the economy would be devastated.
18. Industry Sector: Tourism
19. Exporter and Importer: Many and Portugal
V. ENVIRONMENT CLUSTER
20. Environmental Problem Type: HABITat Loss
21. Species Information
Since the case study focuses on the habitat, the habitat of
Madeira is tropical. The amount of bio-diversity is not
tremendously high and there are few studies that have tried to
measure the biodiversity on Madeira. There is a lot of diversity
in the sense of animal-life, plant life and the surrounding
ocean. The variety is a lot since there are many habitats, but
quantification of this is difficult.
22. Impact and Effect: Low and 100s of years
23. Urgency and Lifetime
24. Substitutes
VI. Other Factors
25. Culture
The economic transformation has drastically changed the life
of the Madeiran and continues to do so. It seems as though the
younger generation has the upper-hand because they support the
economic changes. In a larger context, one could argue the point
that the debate on the island is a conflict between the European
continental culture of market capitalism and the once-insular
cultural way-of-life for the Madeiran. Culture plays a strong
role in the environment/trade relationship on Madeira.
26. Human Rights
27. Trans-boundary Issue
28. Relevant Literature
Blum, Patrick. "Survey of Madeira." Financial Times (June 17,
1992).
Burdin, Susan J. "Madeira." Europe: Magazine of the European
Community n333 (February 1994).
McCarry, John. "Madeira Toasts the Future." National Geographic
v186n5 (November 1994).
"Shocking European bird survey finds 195 species endangered." The
Times (December 2, 1994).
"Commission Report on the Progress Achieved in Implementing
POSEIMA." RAPID (December 12, 1994).
Council of the European Communities, "Council Decision of 26 June
1991 setting up a programme of options specific to the remote and
Commission of the European Communities (June 29, 1991).
Council of the European Communities, "Council Regulation No.
1600/92 of 15 June 1992 concerning specific measures for the
Azores and Madeira relating to certain agricultural products."
Council of Ministers of the European Communities (June 15, 1992).
"POSEIMA: Farm input regime should be strengthened, says
commission report." Agri Service International (December 16,
1994).
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