29 Jul

Coffee drives us, what drives coffee?

Posted By Politybooks

Gavin FridellIf you’re in a reflective mood with your coffee one day, you might ponder all sorts of things: a fantasy of an exotic, far away coffee land; the feel of a warm, cosmopolitan café; or, if you are more somber, perhaps the volatility of coffee markets and the power of transnational coffee companies. But, what about the state?

In my book, Coffee, I argue that the importance of coffee “statecraft,” both good and bad, has been increasingly sidelined in the dominant coffee debates over free trade versusfair trade. Five key assertions form the basis of my argument.

1. Coffee statecraft has been central to a lot of “bad” in the coffee world.

Colonialism and slavery were both key to coffee expansion in the eighteenth and nineteenth centuries. First Haiti, under French rule, and then Brazil took turns having the world’s largest coffee economies on the backs of slave labour.

In the twentieth century, the state continued to play a central role in the coffee world, often maintaining highly unequal land distribution and terrible working conditions through state violence and mass murder.

2. Coffee statecraft has also been central to some “good” in the coffee world.

Both Costa Rica and Colombia have coffee industries that are dominated by smaller farmers an dare among the most efficient in the world, owing significantly to the role of the state in providing a variety of economic and social supports.

From 1963 to 1989, global coffee prices were regulated by a series of state-driven International Coffee Agreements (ICAs), involving all major producing and consuming countries. For many of those years, coffee farmers worldwide received prices close to or higher than what today would be considered the “fair trade” price.

3. Despite much talk about the decline of the state since the 1980s, coffee statecraft has continued to be of central importance.

The rapid growth of Vietnamese coffee exports, which helped spark a global coffee crisis from 1998 to 2002, occurred not strictly out of market forces. From the 1970s onward, the Vietnamese state was the key player in constructing the country’s entire coffee industry in the pursuit of economic statecraft. Today, Vietnam is the world’s second largest coffee exporter, after Brazil.

4.  Non-state projects, whether corporate social responsibility or fair trade, cannot match the impact and reach of the state.

Starbucks coffee company participates in fair trade and treats its retail workers better than most competitors. At the same time, only around 8.1 percent of its beans are certified fair trade and its workers are still low paid compared to other sectors. Starbucks, like most transnationals, is also a “tax avoider,” depriving the state of needed resources while advocating for government austerity. In 2012, protests emerged in the UK when it was discovered that, despite £3 billion in sales over 14 years, Starbucks had only paid £8.6 million in taxes due to various legal loopholes.    

Fair trade, while not perfect, is a meaningful grassroots project that has reached around 670,000 farmer families. Unfortunately, this represents only around 3 percent of the world’s coffee families.

5. Today, statecraft continues to play a significant role in the coffee world, but often by providing last minute bailouts as crises emerge.

In Central America, only after a major coffee rust crisis began in 2012, resulting in a significant drop in production and the loss of hundreds of thousands of jobs, did states pledge millions of dollars to assist desperate growers. In the end, what is needed is not desperate-bailout statecraft, nor a turn away from statecraft in favour of market-driven initiatives, but better coffee statecraft guided by the history of gains and losses in the highly imperfect global coffee market.