May 31, 2005    -   Press Release

Report on the discussion on sustainability at the ICO meetings, May 2005

Throughout the entire week of the ICO meetings from 16 to 20 May 2005 the producing countries sustained separate meetings during which they attempted to find a common stand point on the discussions on sustainability. The level of measurements needed to support sustainable coffee production varies largely among the different continents, sub-continents and countries. The outcome was therefore that the ICO was requested to lead an official inquiry at the producing countries with regard to what sustainable coffee production means to each of them and to report at the next meetings in September 2005.

A common point however was found by the producing countries on the initiative lead by the German Government and ECF and supported by SECO and the European Coffee Industry, the Common Code for the Coffee Community, i.e. the 4Cs. The producing countries stated clearly, without room for misunderstanding, that the 4Cs are unacceptable to them as it stands currently. In particular, they declared it to be biased, criticized it for its lack of transparency, for its adverse effect on sustainability and that this proposal should not be discussed within the ICO. Quoting the declaration: “Consider that the 4Cs project may have disastrous consequences for coffee producers and particularly for the long-term survival of small producers, thus undermining the sustainability of the coffee economy”.

Our interpretation is that the arrival in this dead-end road is a logical consequence for an approach that only looked at the European consuming markets, but did not pay sufficient attention to the reality in producing countries and in the business practices of coffee traded (export & import). The 4Cs would now need a complete review of all aspects from the very beginning. In our opinion, whether its stakeholders are willing to do so and will release the resources for it is rather questionable, in view that these resources could rather be used for building sustainability from the ground.

The concept of the Worldwide Sustainable Coffee Fund was on the agenda in the Private Sector Consultative Board (PSCB) and the Executive Board.

In the PSCB the industry representatives had received the task to consult with the their members on the acceptability of such a concept in January. During this May session there was no response from the industry’s representatives. The interpretation to this absence of input leads to the assumption that the concept was not even discussed. This is furthermore deplorable as the coffee business worldwide is moving towards a fragmentation and thus becoming vulnerable to competing alternative drinks and further reduction in consumption. The only way out of it is by making a united effort - precisely this is what the Coffee Fund offers.

The Executive Board saw a discussion on the proposals from the Worldwide Sustainable Coffee Fund and the International Institute for Sustainable Development (IISD) to apply for funding from the Common Fund for Commodities (CFC). A surprised represented the comment from US Trade Representative that the US Government does not support any fund scheme although fund schemes, particularly in the US, are most efficient and transparent in providing support to developing countries. The Executive Board, respectively the Council did not submit neither of the proposals to the CFC with the argument that further information was needed.

Although the argument is understandable, an acceptance could have been expected since the funding requested in both cases were only for $ 120,000 each and would have allowed to contribute with information and concretization of proposals to contribute to finding a workable form of implementing sustainability in the coffee business. Delaying these proposals by another 6 months will not help nor the producers nor the coffee business in general.

Although no concrete results had been achieved by the Coffee Fund, it can be regarded as a successful week due to the fact that the concept was discussed in length at many instances and by many people. These discussions lead to a healthy maturation of the concept and increased the awareness of what it represents.

Worldwide Sustainable Coffee Fund

Walter Zwald               Urs Kuechler

Stand: 16. Dezember 2005