The international advocacy group Oxfam is taking on United States coffee retailer Starbucks over the chain’s reluctance to grant Ethiopian coffee farmers the right to control their coffee trademarks, something the company has promised to do earlier this year.
Oxfam ran an ad in the Seattle Times on Wednesday urging the corporate icon to give Ethiopian farmers a greater share of the retail value of their coffees.
”Starbucks refuses to sign an agreement recognising Ethiopia’s ownership of the trademarks of the country’s coffees — the same coffees that millions of poor farmers depend on to make a living,” said the ad, which ran with a picture of an old and grey-haired African farmer.
The advertisement disputed statements made by a Starbucks senior vice-president in testimony to the British on February 27, in which he is quoted as saying: ”We reached an agreement with [the Ethiopian] government to pursue our shared vision around the promotion of Ethiopian coffees.”
In mid-February, Starbucks issued a joint release with the government of Ethiopia stating that the company would no longer stand in the country’s way to obtain trademarks.
The company also pledged to double its purchases from East Africa and from Ethiopia. It promised to provide technical support and capacity building to Ethiopian farmers through a farmer support centre that it will open in East Africa.
Promises
The ad ran statements from a press release the Ethiopian embassy in Washington distributed to the media on behalf of the Ethiopian Fine Coffee Farmers’ Cooperative Unions and Exporters, which said it doesn’t see any effort by the Seattle-based company to make good on its promise.
”When Starbucks announced that it will not block Ethiopia’s initiative and also increase its volume of purchase of Ethiopian coffee, we all welcomed it, believing that it is a good first step and would open the door for negotiations with the company,” said Hailu Gebre Hiwot, chairperson of the Ethiopian Coffee Exporters’ Association, in the statement.
”But we have yet to see any efforts made by Starbucks to come to the table and discuss technical issues on the royalty-free licensing agreement Ethiopia is asking it to sign.”
Coffee is among the most valuable commodities in Ethiopia, one of the world’s poorest countries, and these rights could help lift farmers and their families out of poverty.
Africa is the birthplace of coffee and produces arguably the most exotic taste profile of any coffees in the world.
Starbucks purchases approximately 5% of its high-quality Arabica coffee from African countries of origin such as Ethiopia and Kenya.
High earnings
Jim Donald, president and CEO, said on Wednesday that the company saw a 22% increase in total net revenues to $7,8-billion last year.
The first quarter of fiscal 2007 saw a 22% increase in net revenues to a record $2,4-billion and net earnings of $205-million, an increase of 18% when compared with the first quarter of fiscal 2006.
Starbucks plans to open at least 2 400 new stores on a global basis in fiscal 2007 as well as 1 700 stores in the US.
But the issue of how the company treats farmers has been a recurring publicity problem for Starbucks, which operates more than 13 000 retail locations in 39 countries around the world.
Activist groups such as Rainforest Alliance, Fair Trade and Oxfam have relentlessly prodded the company to practise fair trade, where poor farmers share in some of the hefty profits earned by Western coffee retailers.
Starbucks did not return calls for comment on Wednesday. However, earlier this month, Starbucks chairperson Howard Schultz, who is on the list of the world’s richest people, told Fortune magazine that ”Starbucks is the quintessential people-based business … Everything we do is about humanity.” — IPS