Growing rift over coffee beans

Marketplace Staff Nov 27, 2006


MARK AUSTIN THOMAS: Starbucks CEO Jim Donald will fly to Ethiopia tomorrow to meet with the country’s Prime Minister. The Times of London says there is speculation these talks will focus on a growing rift over a move by Ethiopia’s farmers to trademark their coffee and charge more for it. Madeleine Acey is Enterprise Editor with The Times Online.

MADELEINE ACEY: My understanding from the Ethiopian Intellectual Property Office is that they want their growers to actually own their brand and actually be able to charge a premium for it at source. It’s not protection from fraudsters that they’re looking for, they just want to get a good price for their product at source.

THOMAS: How important financially is the coffee crop to Ethiopia?

ACEY: It’s their biggest export. The percentage of their exports that coffee makes up is literally 90 percent and 54 percent of their GDP is from coffee.

THOMAS: Could this really hurt Starbucks with their customers? Do you think customers would really boycott the company?

ACEY: Well that’s the big question. According to a senior academic at Oxford University, they are really playing Russian roulette with their brand. They’re risking losing the kind of customers they’ve been courting with their fair trade products, with their ethical stance. And you know, it’s seen as almost shot in the foot to promote yourself as fair trade and ethical and to pay between 5 and 10 percent of the retail price to your growers whereas in other regions of the world it’s up to 45 percent.

THOMAS: Thank you so much for talking with us Madeleine.

ACEY: You’re very welcome. Thanks very much.

THOMAS: Madeleine Acey of The Times of London. 15 million Ethiopians rely on the coffee trade.

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