By: Fernando Morales-de la Cruz, Founder of Café For Change
Opinions expressed by Forbes Africa contributors are their own.
The International Coffee Council of the International Coffee Organization (ICO) will meet in Nairobi, Kenya, from March 25 to 29, at a moment of serious crisis in all coffee-producing regions due to the exploitative prices paid by coffee-importing nations.
Unfortunately, at the ICO, the coffee importing members do not include the United States and Canada and, usually, the European Union, importer of 41% of all coffee in the world, is represented at ICO meetings by European Commission officials with no influence on trade issues.
Switzerland, a country that is home to 70% of all coffee trading and even chairs the ICO, is also represented at the ICO by public officials with little or no authority on major trade issues. The ICO and its meeting in Nairobi are therefore of little or no use for solving the coffee crisis.
The increasingly profitable global coffee industry is controlled by a smaller number of more powerful multinationals. A concentration of these companies, in Switzerland, that are trading green coffee, have put 25 million coffee producers and more than 125 million people living in coffee communities in a deep economic and humanitarian crisis, and in a situation of defenselessness.
The drastic fall in the price of coffee, which is not a new issue, has also had a devastating impact on the economies of the coffee-growing countries. Not only coffee growers and workers depend on coffee production. Coffee growing, like many other rural activities, has a huge economic impact on national economies and, even, in the capitals of those nations.
Coffee multinationals now pay less than one dollar per pound of coffee, a price that is 74% less than that agreed in the International Coffee Agreement of 1983. Recently, the price of coffee fell to $0.93 per lb. This amounts to only $0.36 at 1983 prices, according to the Consumer Price Index (CPI) of the United States DOL. The coffee price in 1983, agreed by the importing countries (Europe, Switzerland, United States, Canada, Japan, etc.), was $1.20 to $1.40 per lb because it was estimated that this amount could, reasonably, cover production costs in the coffee countries.
The “Ideal Price” of Coffee
The solution to the crisis in the price of coffee has been further complicated by the position taken by the National Federation of Coffee Growers of Columbia, FNC, representing the third largest coffee producer in the world, to try to set and promote internationally an “ideal price” of only $1.40 to $1.50 per lb, even below the false and unjust “fair price” of $1.40 + $0.20 premium, defended by “fairtrade”.
The “ideal price” proposed by the FNC, $1.50 per lb, is less than 42% of the price of the 1983 International Coffee Agreement. That price is “ideal” for multinationals but it is not ideal for coffee-growers or rural workers in any country in the coffee belt.
It is absolutely unfair that farmers
should receive 58% less in 2019 than what they were paid by multinationals in
1983, more than 35 years ago. The production costs of farmers have increased
substantially since 1983 but, on the other hand, they have also increased by
tens of billions of dollars per year, in coffee-importing countries, the
profits, the added value and the taxes generated for the coffee crop to be sold
to the final consumer.
The multinationals estimate internally the FOB value of coffee at between $4 and $5.50 per lb., an estimate that makes a lot of sense when calculating that the price of $1.40 of the ICA of 1983, adjusted for inflation and using the CPI of the US Department of Labor, would today be $3.61 lb. After adding taxes in origin, the true cost of land, social security, pensions and education to the price of coffee of 1983, the current price should be between $4 and $5.50 per pound, as the multinationals estimate internally.
Obviously, the multinationals work with development agencies on false sustainability initiatives, and NGOs that claim to fight against poverty, even though they perpetuate it, “studying” and promoting production costs that only suit multinationals and condemn farmers and workers, and their children, to extreme poverty.
“Production costs” that also guarantee underdevelopment in rural communities so that coffee continues to be available, together with many other agricultural products, at a very low price for the developed nations.
One of the greatest challenges for coffee-growers is that most of them are poor and have no way of defending themselves against greed and the influence of multinationals in their own cooperatives and organizations, nor in their national governments and institutions.
Farmers operate locally, regionally and, in very few cases, at the national level, while on the other hand, multinationals, by their nature, operate and have economic, political and communication influence at a global level.
It is much easier for a multinational to influence the national agricultural policy of any country, or all of them simultaneously, than for the majority of coffee farmers together. It is obvious that neither national coffee organizations nor governments have known how to, or have wanted to defend producers for decades and this is why we have reached the unacceptable reality that multinationals now buy coffee 74% cheaper than 36 years ago and farmers receive less than two cents for every cup of coffee served in developed nations.
This cannot go on like this. It is essential to create and implement a transparent shared value system that compensates producers and workers, and also rural communities, with at least $0.10 per cup.
The true ideal price of coffee, cocoa, tea or any other product is one that allows all farmers and workers, and all their children, to aspire to be middle class, because they are the basis of an industry that generates tens of billions of US dollars in profits annually.
To all the friends of the National Federation of Coffee Growers, to the 25 million producers from all over the world, to all the organizations of coffee-growers and to the presidents and officials of the governments of coffee-producing countries, I invite you all to fight together for a truly ideal price that allows everyone from the coffee belt, and all their children and dependents, to live with dignity by growing coffee.
Neocolonialism and the exploitation of farmers, workers and millions of defenseless children and the fraudulent “fairtrade” and false certifications cannot be part of the “coffee landscape” of each chocolate bar or any other industry that presumes to operate within of the law, respecting human rights and the rights of children.
‘Life Is Not Complex If You Stay Positive’
Rakesh Wahi recounts a deeply personal journey that culminated in an opportune meeting with the Dalai Lama.
Life is an interesting journey made up of events, experiences and interactions that collectively teach you some important lessons. All of them consciously or unconsciously have an impact on your life; some more than others. There are some events that impact the inner core of your being.
One such is the loss of a parent. This is a nightmare for any child irrespective of age. I lost my father, Col SP Wahi, on February 13 2017. He had lived his life to the full and left his mark on everything he touched – a true legend.
Grieving is a process and we all deal with grief in our own way. Going through the Hindu rituals around my father’s cremation took its toll on me. I had been through many such rituals, watching other sons grieve their fathers, but living my own was heart-wrenching.
The flight to New Delhi from Johannesburg was 16 hours including a stop-over in Dubai that seemed like eternity.
Even at 58, I was numb, with memories flashing through my mind, but most of all, with the fear of not knowing what to expect. My thoughts were with my mother and two sisters as I know how close we all were to my father.
The most important lesson from this was how a family comes together dealing with the loss of a father, the head of the family. We rallied around our mother through the personal emotions and yet put on a brave front as we dealt with the thousands of well-wishers who poured in to join us in mourning.
As we started going through the motions of accepting what had happened, an invisible, remote-controlled switch flipped inside me, rebooting me to become a vegetarian and teetotaler. These were my mother’s choices all her life; but it wasn’t just these choices but my thinking that was rebooted, to go back in her service.
Was this divine intervention for realigning your relationships, or was there something psychologically more profound with one day having to deal with another loss? I have no answer to this question yet.
What, however, followed from this rebooting was a desire to begin planning a schedule for my mother so she could continue her life as usual whilst coming to terms with the irreparable void.
My mother has been extremely religious all her life and is a devout Hindu who believes in embracing all rituals. Her faith and philanthropy brought her close to many religious leaders including Mother Teresa. The one place she had visited 19 times on pilgrimage was the Vaishno Devi temple in the Indian state of Jammu and Kashmir.
This has been her calling, to worship the Indian goddesses Saraswati, Lakshmi and Mahakali, all enshrined in Vaishno Devi. Along with my wife and two sisters, I decided to take her on this pilgrimage, for what would be her 20th visit to Vaishno Devi. I had passed through Jammu many times during my military career but as one seldom swayed by rituals, I never deviated from the path.
This was perhaps my calling.
Vaishno Devi was, as expected, a blissful experience. There is a message when He chooses to test your faith and endurance, and He did test ours. The weather took a nasty turn and a helicopter charter from Katra (a small town in Jammu and Kashmir) was not to be, on our return.
My mother, who turned 80 this year, managed the walk down from the temple to the helipad at Sanjichhat and then to Adhkuwari, from where we got her a palaki (palanquin). The four-hour turnaround took us 10 hours.
This was a highlight, but what followed was even more so – a confirmation that the Dalai Lama was in residence at his monastery in McLeodGanj in Dharamsala (a hill station in the Indian state of Himachal Pradesh),and had agreed to give us an audience on September 28.
This date has always proven auspicious for me, as,coincidentally, a number of my life’s turning points have happened on or adjacent this date. For instance, on this day, 30 years ago, I had finally stepped out of my military fatigues.
This year, on the same date, we were ushered into His Holiness, the Dalai Lama’s ante-room for a private meeting for the family with him. A stream of monks and visitors before us had been granted an audience, so we waited anxiously for our turn.
Meeting the Dalai Lama is no longer easy, owing to his numerous commitments and busy schedule.
As His Holiness entered, a few assistants milled around and a photographer frantically clicked away. As briefed, we each held a white satin shawl in our hands that he placed around our necks and then touched our heads in blessing.
When it came to my mother, he put the shawl around her neck and placed her hand on his head to seek her blessings, after which he touched her head.
This departure in protocol showed the mark of a great human who recognized another enriched soul.
In the one hour we got with him, he spoke about his beliefs. His first thoughts were on secularism and the reason he continued to live in India – because of tolerance, and the need for all humans to show tolerance to others. He said religion is a subset of spirituality and being good is more important than being religious – “Follow your faith but do not fail to do good as that helps mankind.”
He spoke briefly about his views on Buddhism in China, where 300 million Buddhists live. He expressed the hope that someday the intolerance would end and people would embrace this noble way of life.
What he was most disappointed about was how the western world had moved away from the basic norms of family and spirituality into a society entrenched in materialism; the loss of basic human values where ever it occurs is a misfortune, he said. He traveled extensively to remind people of their responsibilities, to restore faith and practise spirituality.
His final words to us were about optimism, and inner peace.He advocated seeing everything through a positive lens to be at peace with oneself. This was the only way to progress and to remain strong.
“Life is not complex if you stay positive, stay at peace and do good,” he said. Simple but profound words that make a difference in our lives; we all know these only too well but in our everyday pursuits overlook what is indeed important.
He blessed us by giving us copies of his book, and obliged us by posing for many photographs. Before we left, my wife, Saloni, spoke to him about Tonglen (something she has been reading and practising) and he was surprised someone knew about this teaching. He blessed her and immediately asked his staff to present two books to her that he personally signed.
What resonated most for me was his belief about actions being louder than words. Being good, doing good and helping others are a way of life that should be our religion and not just rituals.
This was the belief of my late father and perhaps this opportune meeting with His Holiness completed a circle in my life for which it was destined.
I have always said that you meet people for a reason and that they come into your life for a reason. There is immense pride in me to have met Madiba (the late Nelson Mandela), in 2006, and now His Holiness, the Dalai Lama. I take inspiration from these selfless humans who have chosen a path that has afforded them an opportunity to touch the lives of millions.
– The writer is Co-Founder of the ABN Group that includes FORBES AFRICA and CNBC Africa.
Even If We Conquer Death – Should We?
“Nothing can be said to be certain, except Death and Taxes” – Benjamin Franklin, 1789
As we head into the Fourth Industrial Revolution (4IR), there is the possibility that only one of those will remain a certainty.
While taxes may morph from employee-contribution-for-state-resources, to a nominal amount on the gains of technology, to a Universal Basic Income (UBI) – death may yet be conquered.
An increasing number of futurists believe that death is a disease; and like any disease it can be cured. Perhaps the most prominent of these is Ray Kurzweil, Google’s chief futurist, with a prediction accuracy rate of 86% (115 of 147 since the 1990s). Kurzweil believes by 2029, we will see signs of living forever when we reach ‘Longevity Escape Velocity’ – the point at which every year we live, we extend our lifespan by at least another year.
The oldest verified living person, Chiyo Miyako, died at 117 years old in July. However, the number of centenarians is up 44% from 2000 to 2014. Improvements in vaccines, antibiotics, hygiene and sanitation are all contributing factors to increasing survival to advanced ages.
Coupled with affordable healthcare, food abundance, and a decrease in non-natural death causes (war, measles, diabetes), global life expectancy increased from 65.3 years in 1990 to 71.5 years in 2013.
The cost of sequencing the genome has decreased exponentially from approximately $150 million (2013) to under $1,000 (2015), a reduction of 150,000x. Once quantum computers become mainstream, the cost to sequence an individual genome could be cheaper than flushing the toilet! This could lead to mass customized medicines, further decreasing human mortality rate.
Additionally, the introduction of CRISPr allows scientists to cut out and replace living DNA; effectively eradicating almost all diseases and rewriting the genetic code that governs life expectancy.
And we haven’t even included advancements in nano-tech, AI to determine genetic diffusions, R&D into reversing aging, 3D printing organs, or human augmentation to the point of ‘the singularity’.
With life expectancy of, say 200, versus today’s 75, there are a number of considerations. Many challenge the conventional paradigms we currently deem normal. Questions of increased retirement, education systems, second, third or even fourth careers, children and life-savings, are obvious short-term issues to address.
At a micro level, which individual wouldn’t want to spend just another year with a sick loved one? However, at a macro level, this would be far from ideal. Arguably, the greatest issue we face is resource constraints caused – not by over-population per se (the United Nations projects a world population of 9.7 billion by 2050) – but by the number of consumers and the scale/nature of that consumption.
Across Africa, the median age is 19.4 years with a total population of approximately 1.3 billion, however, the average age of the continental leadership is 65 years old. Already Africa has a history of dictatorships, and with leaders living longer, will we have more authoritarian rule?
With an increasingly aging active workforce, what is the future of jobs? Especially coupled with the replacement of labor with 4IR technologies (robotics, AI, automated plants) and youth unemployment upwards of 50%. From a capitalist perspective, efficiency gains and profit maximization will drive business decisions. However, are we further creating a situation whereby the Gini gap increases while the rich, aging, experienced reap the benefits of longevity? Are we sitting atop a socio-economic time bomb with increasing inequality?
Advances in technology will definitely drive the upward age of longevity toward the 200 mark. However, there are a number of considerations – both moral and social – that we have not begun to think about, as a species. Ultimately, the question is no longer if death (like taxes) is inevitable, but rather: even if we can conquer death – should we?
– By Craig Wing, a partner at FutureWorld International, driving innovation and futures thinking across organizations globally. He is a thought-leader on 4IR, future of work and corporate culture.
It’s About Time For Success For Entrepreneurs In Africa
As a teenager it dawned on me that my undergraduate academic ambition was going to be threatened when my father lost his job. My dream to become a petroleum engineer was deflated in a matter of days. I was concerned about my future and afraid I would be tagged as a failure. During this unpleasant and frustrating experience, I questioned the rationale behind my dad’s choice of paid employment. If he had started a business, maybe things would have turned out differently. That was a tipping point for my search for success in life.
In 1999, I found a book that answered the question of how to be successful. The Success Journey, written by John C. Maxwell, sparked my hunger for knowledge, which led me to start visiting a public library built by the Catholic church in my town, in southwestern Nigeria. I made that decision because I had read in the book that knowledge is a prerequisite for success.
My need to be successful and influential was so strong that it birthed inspirational dissatisfaction in me. In the same manner, I have observed that many successful business owners often start with a burning desire and this desire takes up most of their time, most of their resources and almost all of their energy. I believe that is what counts for entrepreneurship.
On the other hand, I have also encountered many African start-up entrepreneurs who have ideas that lack that yearning. All they have is a wish that may or may not be achieved, and a template-guided business plan. Most of these plans remain on paper and are eventually buried. Some that succeed in starting their own business don’t get to live their dream beyond a few years.
Other than the fact that many African countries have a poor rating on the ease of doing business index, a core factor that accounts for a business’s inability to survive is the lack of a burning desire. Success is for the hungry and desire is the emotion that will see it come to fruition.
It is important that a target is clearly defined before commencing with a business plan and allocating responsibilities. This helps everyone to effectively focus on crucial matters. In the present business space, time is more essential than money. The rate at which business disruption happens is so fast that many business leaders are constantly on their toes to just remain in the game. With this in mind, attention should only be given to what is important – the key drivers of the desired result.
Obviously, entrepreneurs in Africa are finding it easier now than a decade ago to hire tools, and raise capital to produce products. But, realizing the ability to rent time is highly unlikely in the near future. Time is inelastic. Therefore, we must focus on what really matters to get the desirable business result.
To better manage time, an entrepreneur should focus on what they have control over. When you focus on concerns that you can’t control, you may lose sight of things within your control.
Also, ensure your beliefs and values align with the desired business result because these influence your time and attention.
Setting goals, and planning for them, are instrumental to time management. This will help guide decisions as well as allowing you to delegate where necessary.
I have accepted the simple paradigm that nothing makes one entrepreneur more successful than the other in an industry as much as what each person does with time. Time creates everybody’s chance, but not everybody creates a chance with the time they have.
– Victor Mamora
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