An internal feud between Ethiopian private exporters and the government caught the media spotlight recently but, as usual, limited journalism coverage derailed the attention off the fundamental issues.
On March 25, 2009, the government seized 17,000 tons of coffee beans from six exporters, and revoked their licenses. The government is now considering selling the seized stocks itself on the international market. The licenses of additional 88 independent traders had also been cancelled for failing to heed the authorities.
This happened after Prime Minister Meles Zenawi accused some coffee exporters in January of having been reluctant to sell stocks through the Ethiopian Commodity Exchange (ECX). He warned them of conspiring and disturbing the integrity of the ECX system by supplying and then buying back their own coffees to sell coffee meant for export on the domestic market, threatening to “cut off one of their hands” if they did not behave.
The exporters deny these accusations.
When the media picked and wagged a thread, the news spilled over to global markets and sent a shockwave across the specialty coffee community. Some importers of specialty coffees got worried that the new coffee law may put an end to direct sourcing of beans and severely impacted the already scant traceability of Ethiopia’s coffee beans.
In all this, the farmers’ voice is drowned out and their concerns left unnoticed.
As it happens, the recent development in Ethiopia’s coffee sector has more ramifications to the national economy than on the specialty coffee industry. Importers and roasters interviewed for this report confirmed that their sourcing is unaffected while the feud continues.
To understand the underlying reasons for the private exporters’ frustrations and the government’s heavy-handed actions, one needs to look at the history of coffee in Ethiopia and what changed in recent years.
Political Crop
Ethiopia, the birthplace of coffee, is the sixth largest coffee producer and the seventh largest exporter worldwide. It is the largest coffee producer and exporter in Africa. Exports between March 2008 and February 2009 were 2,679,155 bags of coffee beans, a share of 2.73 percent in global coffee trade.
The fine quality of its coffees and the distinctive features of the sector, including its genetic resources, abundance of wild coffee trees, and the organic coffee production, earned Ethiopia a unique place in the global coffee marketplace.
Coffee is the backbone of Ethiopia’s economy. In the 2007/2008, coffee export fetched more than 525 million dollars, accounting for about 60 percent of the country’s hard currency earnings. Moreover, coffee provides an important source of income for a large portion of the population and is an important source of tax revenue to the government.
Coffee holds a strong political significance in Ethiopia because of its tremendous importance in the economy and its political purposes for the regime. The ruling party ensures the centralized collection and controlling of foreign currency in order to stay in power.
Currently, the government is strapped; its foreign currency reserve is at its lowest level of $850 million, enough to cover only a month’s imports. The foreign exchange shortage was exacerbated by declines in global coffee prices, poor harvest, and contraction of sales following the loss of Japan’s market due to the ban imposed in May 2008 by Japan after finding “abnormally high” pesticide residues in a shipment of the beans.
Under these circumstances, coffee can be extremely appealing to the government.
The Ethiopian Commodity Exchange (ECX)
The Ethiopian Commodity Exchange (ECX), a government owned central trading system, meant primarily for grains, began trading coffee in December 2008. Launched in May 2008, the trading platform was set up to replace the murky auction system often abused by market participants.
During the ECX rollout, which happened to coincide with the global economic turmoil where domestic and global prices were sharply rising, there was severe shortage of grains flowing through the exchange.
Although it is authorized to trade in both spot and futures contracts, ECX announced in April 2008 that it intends to start off with only spot contracts for immediate delivery (as a strategic driver of the ultimate futures trading) and impose compulsory delivery of grains.
In August 2008, the government swiftly enacted a new coffee law in order to provide ECX with the necessary legal framework that would enable it, among others, to impose compulsory delivery of coffees. This law requires all coffees to be traded through the ECX – the only outlet to international markets.
The New Coffee Law
The new coffee law, as some call it, is believed to be what sparked the outcry among private exporters in Ethiopia and the specialty coffee community. Outside Ethiopia, there is confusion on whether or not the law prohibits direct sourcing of single origin coffees.
The law, formally known as the Coffee Quality Control and Marketing Proclamation (No. 602/2008*, declares all coffee trade “shall take place in lawful coffee transaction centers.”
More specifically, Article 10(1) reads:
“Any person involved in the roasting and grinding of coffee for selling shall purchase the coffee for such purpose only from auction centers, the Ethiopia Commodity Exchange or wholesalers.”
But Article 11 appears to be leaving room for direct sourcing:
“Any coffee producer shall: 1/ without prejudice to Article 6(1) of this Proclamation, have the right to directly export coffee from his own farm, only after submitting the same to the coffee quality liquoring and inspection center for grading before and after processing for export; and 2/ sell coffee by product in auction centers or the Ethiopia Commodity Exchange only upon examination and approval of the coffee quality liquoring and inspection center.”
This provision makes it easier for coffee farmers’ cooperatives and marketing unions to transact with importers directly. Some of the cooperatives and unions that are reasonably equipped and well positioned to handle export orders will hopefully reap the benefits of direct marketing.
Meanwhile, farmers that are not organized in cooperatives, which constitute the majority of the farming community, are disadvantaged, as dealing with importers from thousands of miles away would be challenging, if not impossible. However, importers do have the option and abilities to initiate and enter into contracts with all producers and access their favorite coffee origins by establishing direct relationships with producers. This approach helps the poor farmers dig themselves out of the traps of poverty and eternal exploitation.
The law abolishes the old practices by some exporters of handholding coffee bags from farm gate to export. Now, they will have to compete with other exporters if they need to buy specific bag of cherries supplied by suppliers or “akrabis.”
In this respect, the Coffee Quality Control and Marketing Proclamation and ECX call for segregation of duty at all levels of the value chain. It appears, though, the government is now in violation of this noble code of ethics.
Conflict of Interest
The present-day domestic marketing chain in Ethiopia is as old as the export trade itself. The bean passes through numerous market participants before arriving at the central auction centers: collectors or “sebsabis” collect the beans at local stations from rural merchants or farmers and sell it to suppliers or “akrabis”; akrabis deliver the coffee en masse to the auction centers; private exporters or local distributors buy from auction centers. Suppliers and exporters are not allowed to bypass the auctions and exchange directly.
With the introduction of the new exchange system the auction centers are replaced by the ECX, while all other participants continue to function as is, but with one fundamental change: transparency. The previous auction system was marred with loopholes that seem to have allowed some exporters holding dual licenses to purchase back their own coffee in the auctions, thereby enjoying too much control over coffee prices. Supposedly, ECX’ introduction of rules of trading, warehousing, payments and delivery, and business conduct principles will seal off those loopholes. This seems to have upset a few exporters and fired back at by the government accusing them of engaging in conflict of interest.
But the government’s reactions were even more troubling. It not only confiscated coffee beans from the exporters but also tasked the state owned Ethiopian Grain Trade Enterprise (EGTE) with exporting of coffee.
This measure throws privatization and domestic market liberalization out in the window.
Ethiopia’s coffee market has always been a relatively private business, with the exception of limited government interventions to enforce quality standards, etc. This was true even during the days of the communist regime that “nationalized” almost every sector in the nation.
EGTE’s slated assignment marks a detrimental precedence in the nation’s history. The government’s engagement in exporting beans produced by smallholder families while it controls almost all means of production in the country, including the distribution of farm inputs, capital, and the land, is inconsistent with principles of a free market system.
Drowned Out Voices
As usual, when those up in the value chain fight, in this case the government and private exporters, it is the farmers that suffer most. In Ethiopia, smallholder farmers produce about 95 per cent of the nation’s total coffee production and these farmers rely on the sale of their cherries for their families’ mere survival.
For generations, Ethiopian coffee farmers have been at the mercy of their marauders. In the long and inefficient marketing chain, each participant marks up their prices weighing down the burden on the farmers’ shoulders. Ethiopian farmers receive barely a small fraction of the value their produce is worth, currently around 40 percent of export prices, much less than the 70 percent that their counterparts in Central and South America receive.
A transparent and efficient exchange market system nurtures competition and benefits everyone in the value chain, from bean to cup. Farmers producing the finest quality coffee can get rewarded for their hard work as well as suppliers and exporters whose innovation and smart marketing skills pay off.
But, if given the choice, farmers in Ethiopia would choose direct marketing over a chain of licensees that add little value to the product. To that effect, ECX would be more beneficial to the farmers if its processes support and facilitate for more farmer-importer relationships.
Looking Ahead
The role of a centralized modern commodity exchange is indispensable for developing economies, such as Ethiopia.
The country’s coffee sector is highly dependent on international prices and the export is affected by the structure and workings of the world coffee market. The market participants need to understand that Ethiopia is competing with countries that have the abilities and the will to easily adopt innovative low-cost production and marketing systems.
The current bickering and prejudice will only affect coffee quality, weaken the country’s brands, deter potential importers, and put the sector at risk. The government needs to exercise restraint, listen to and address the concerns of all participants, from farmers to importers. Its obligation to protect the farmers from exploitation includes itself as well. Replacing private exporters by EGTE won’t lessen the burden on poor farmers.
The interests of all participants can be better served if the market functions, in the words from ECX’ mission statement, “based on continuous learning, fairness, and commitment to excellence.”
FORT WORTH, TEXAS — Scott Brown traveled to Ethiopia in 2006 to watch over the adoption of Enoch, a 3-month-old, 5-pound boy with big brown eyes.
It was the first adoption the Gladney Center for Adoption would oversee in Ethiopia, and Brown, its executive vice president, wanted to make sure it went smoothly
And it did — until the couple preparing to adopt Enoch realized that something was wrong with his head. Tests showed a condition that is fatal about half of the time in Ethiopia: craniosynostosis, when a soft spot in the skull closes too quickly and prevents the brain from growing.
The couple, not sure they could handle a baby with such medical needs, backed out of the adoption. When Brown learned Enoch could die without treatment, he persuaded doctors and medical personnel at Cook Children’s Medical Center to operate to save Enoch.
Three years later, Enoch is healthy and happy. He is now Brown’s grandson, having been adopted by Brown’s son and daughter-in-law, Ryan and Abby Brown.
“We feel so blessed and fortunate that God chose to place him in our lives,” Abby Brown said on a Gladney video. “We call him our little miracle.”
But there are more babies and children in Ethiopia whom Scott Brown and doctors at Cook Children’s — some who belong to Christ Chapel Bible Church in Fort Worth — want to help.
That’s why they are in Enoch’s homeland now on a medical mission.
There, more than half a dozen local medical personnel are visiting hospitals and clinics in Addis Ababa, Ethiopia’s capital, and in the remote village of Gunchire.
They are giving lectures, making rounds, performing surgeries and sharing thousands of dollars of donated medicine and supplies, hoping to help save and improve the lives of Ethiopians.
“These are genuine people who are doing the very best with what they have,” Brown wrote in an e-mail from Ethiopia. “My vision for this trip is that it is the first of many.”
Living out their faith
For many, this trip is a way to serve their church, help others and share their faith.
For several years, Christ Chapel and its members, which include Brown, have worked to help orphans in Ethiopia, even building an orphanage in Gunchire.
Now they are evaluating the medical situation there, to see how they can be the most effective.
“A key vision of our church is to be ‘a church without walls,’ ” said Dr. Michael Stevener, this mission team’s leader and a neonatologist at Cook Children’s. “Members are encouraged to be the ‘hands and feet of Christ’ in service to the needy both locally and around the world.
“For me personally, the trip is part of a spiritual calling to live out my faith using my abilities and resources to help others.”
He and others say there are more Ethiopian doctors in Washington, D.C., than in all of Ethiopia. Many move to the United States after getting their training. Those who stay, Stevener said, truly love their country and want to make a difference.
Christ Chapel Executive Pastor Bill Egner said the impact that local doctors have on their Ethiopian counterparts could create a ripple effect for years to come.
“It’s about empowering those good doctors to become more of what they would like to become,” said Egner, who led a pastoral trip to Ethiopia in January.
“There are techniques or tools our doctors can teach that will make substantial impacts — and make a difference in people’s lives from Day One.”
Tour of duty
Brown and local medical personnel — including two neonatologists and the pediatric neurosurgeon who operated on Enoch — arrived in Ethiopia last week and plan to return home next Sunday.
During the trip, they will talk about topics ranging from newborn resuscitation to allergic reactions to drugs. They’ll visit medical facilities, including Kidmia Transitional Care Home, Guchire Regional Health Clinic, the Black Lion Hospital, Korean Medical Center and the Mother Teresa HIV orphanage/clinic.
And they’ll be sharing suitcases full of medicine and medical supplies donated by Cook Children’s, Texas Health Fort Worth hospital, Christ Chapel and others. Some of the doctors are also donating medicine and medical supplies from their offices.
Ethiopian pediatric physician Dr. Etsegenet Gedlu said she believes the doctors from Fort Worth can help her and her colleagues.
“The lectures and workshops will definitely give . . . our students, interns [and] residents a new insight and sharing experience from other perspectives,” she wrote in an e-mail. “We all are hoping . . . we may find a common ground for future collaboration.
“I hope our colleagues will find this visit beneficial in terms of … experiencing medical practice in a different setup and quite different disease epidemiology.”
Humanitarian adoptions
Adoptions of Ethiopian children have sharply risen in recent years. In the U.S. last year, 1,725 Ethiopian children were adopted, 470 more than in 2005, U.S. State Department records show.
Local adoptions have risen as well.
Gladney facilitated four adoptions from Ethiopia in 2006, its first year doing so. In 2007, there were 47, and last year, there were 99. This year, there have been 67, but officials believe they may place 125 Ethiopia children in U.S. homes by Aug. 31, said Jennifer Lanter, public information officer for Gladney.
“In Ethiopia — with extreme poverty, the AIDS virus — there are so many horrific things happening, and the people there don’t want their children suffering,” Lanter said. “They want their children to have a home.”
More than that, adoption officials say they see a new trend emerging.
“Before, families adopted to grow their families,” Lanter said. “With Ethiopia, a lot of churches have gotten involved, and many feel called to adopt through this country to help these people.
“People are now adopting for a new reason — for a humanitarian reason.”
Working in Ethiopia The team includes medical personnel from Cook Children’s Medical Center:
Dr. Michael Stevener, a neonatologist, and his wife, Beth Stevener
Dr. Michael Stanley, a neonatologist
Dr. David Donahue, a pediatric neurosurgeon
Ben Donahue, an anesthesia technician and pre-med student
Dr. Robin Roberts, an adult dermatologist
Amy Schubert, a pediatric ward nurse
Dr. Jeff McGlothlin, a pediatric neurologist
Dr. Benjamin Sui, a pediatric cardiologist
Scott Brown, executive vice president and director of the Ethiopia program for the Gladney Center for Adoption (and father of a girl adopted from Ethiopia)
Loran Zemedu Araya is one of the three suspects in the killing of Ethiopian businessman Tedla Lemma in a suburb of Atlanta
LAWRENCEVILLE (GDP) – A Riverdale man is to stand trial this week in the killing of a disabled Lilburn business owner last year.
Quincy Marcel Jackson joins three co-defendants implicated in the killing of Tedla Lemma, 51, in his upscale Kenion Forest Drive home March 25, 2008.
Police believe Jackson and his accomplices first pillaged Lemma’s home in November 2007 for cash and valuables. On the return trip, Lemma was reportedly hog-tied, beaten and gagged so tightly he suffocated.
A grand jury indicted Jackson in September on 18 counts, including murder and kidnapping. He has remained in jail since his July arrest.
Jackson’s former roommate in Riverdale, Marshae Brooks, was arrested and charged with murder in February after the third suspect, Loran Araya, told prosecutors of his involvement. Cell phone records helped tie all three to the scene, police said.
Police believe the crew perpetrated four home-invasion robberies in the months prior to Lemma’s death, including the kidnapping of two Buckhead jewelry store owners living in Stone Mountain.
Police say Araya, a former Lilburn resident, knew most of the victims. Her parents once sold a package store to Lemma’s family.
At the time of his death, Lemma, an affluent convenience store owner from Ethiopia, was paralyzed from a robbery when he was shot in the head several years ago. Detectives have testified the suspects never intended to kill Lemma and only learned of his death via broadcast news reports hours later.
Detectives are searching for a fourth suspect in the murder known on the streets as “Money Mark,” an investigator testified last month.
AMMAN (Jordan Times) – Ethiopia’s Habte Dibaba Robele was crowned champion of the men’s Ultra Marathon (48.7km) after clocking 3h05m leaving second place to Iraq’s Nouri Jaber with 3h05m39s and Jordan’s Salameh Al Aqra’ came in third place with 3h06m27s.
Robele, who took part for the first time in the event, was not able to break last year’s record registered by American Mark Werner, who clocked 2h58m36s.
Jordanian runners excelled in the 16th annual run of the LG Dead Sea Ultra Marathon (LG DSUM) held on Friday.
In the 42km race, Suleiman Zboun took first place with a new record of 2h11m14s, and left second place to Mithqal Abadi, who also registered a new record in this category with 2h12m33s, and third place to Hayel Rawahneh with 2h18m58s.
In the women’s category, Jordan’s Kholoud Atieh won first place with 2h51m39s, followed by Americans Maya Buchanan, 3h28m41s and Krysten Koehn, 3h55m56s.
In the men’s Half marathon (21km) Jordanians Ra’fat Qasem won with a time of 1h05m14s, followed by Hussein Momani (1h07m24s) and Ayman Ahmad (1h08m19s).
In the women’s race Canada’s Katherine Muckle won in a time of 1h01m52s, followed by Americans Tracey Villano (1h29m16s) and Erica Dueger (1h34m28s).
Jordanian’s also swept the men’s Fun Run 10km with Mohammad Abu Rizeq (35m1s) coming in first, followed by Majd Suleiman (35m5s) and Abdullah Saleh (356s).
Iraqi Ola Jasem (45m58s) won the women’s Fun Run. Jordanian’s Laura Diaz (51m41s) and Hoson Akeel (52m23s) came in second and third respectively.
In the women’s category, UK’s Sara Connor took the first spot, with 4h05m39s, followed by Naomi Ferguson, 4h06m33s, and German’s Anita Ehrhardt, 4h13m37s.
In the boy’s Junior Marathon (4.2km), for 6-15 year olds, Basel Riyad won followed by Basel Awad and Mohammad Abu Shileh. The girl’s Junior Marathon was won by Lyan Al Saheb, followed by Areej Al Saheb and Eman Audeh.
The LG DSUM, held under the patronage of HRH Prince Raad, the Chief Chamberlain, was organised by the Society for Care of Neurological Patients (SCNP) and had a record number of 4,500 runners.
Prince Raad, HRH Prince Mired and HRH Princess Majeda watched the annual marathon and expressed their satisfaction with the event which promotes the Kingdom globally.
The event ran from Amman International Motor Show at the Airport Road to Amman Beach at the Dead Sea, 400m below sea level, the lowest point on earth.
The sponsers were LG Electronics, the Greater Amman Municipality, Public Security, Civil Defence Department, Aquafina, Emirates Airlines, MEC, Jordan Television, Picasso, Kassab, Scholl, Moonlight for Tourism and Travel, Sawt Al Ghad radio station, Sunny FM, Grand Hyatt Amman, Layalina magazine, Cozmo, National Paints, AdDustour newspaper, Jordan Today magazine and Movenpick.
Ababiya Abajobir, the uncle of Kemeria Abajobir Abajifar
The mysterious Ethiopian woman identified as the cause for the divorce between the reality TV show star LuAnn from The Real Houswives of New York and her husband Count Alexandre de Lesseps has been identified as Princess Kemeria Abajobir Abajifar. She is the granddaughter of King Abajifar, the last King from the Gibe Kingdom of Jimmaa, located in current day Ethiopia.
An inside source close to the Count, wishing to remain anonymous, confirmed the details in an email correspondence.
The Ethiopian princess, and granddaughter of the King, is the niece of Ababiya Abajobir, another prominent man in the Oromo-Ethiopian community. He was one of the founding members of the OLF (Oromo Liberation Front), an armed Ethiopian opposition group, and served in various positions in the organization throughout its 35 year history.
The source told EthioPlanet that it was the wish of both the Princess and Count Alexandre de Lesseps that she no longer be identified as “‘the Ethiopian woman’ but with her real identity.”
Few people outside Ethiopia have ever heard of Birtukan Mideksa. And that’s just how the government wants it. Since December, Birtukan has been kept in solitary confinement, one of hundreds of political prisoners there. Her apparent crime? Organizing a democratic challenge to the increasingly iron-fisted rule of Prime Minister Meles Zenawi.
In the past year alone, Meles’s ruling party has rigged elections, effectively banned independent human-rights groups, passed a draconian press law and shrugged off calls for an investigation into alleged atrocities in the restive Ogaden region. Yet in the same period, his country has become one of the largest recipients of U.S. aid in sub-Saharan Africa, getting a cool $1 billion in 2008. The Bush administration claimed that Ethiopia was the linch-pin of its regional counterterrorism strategy and a vital beacon of stability. But the evidence increasingly suggests Washington isn’t getting what it pays for, and is supporting a brutal dictator in the process. Candidate Obama pledged to strengthen democracy in Africa; if he’s serious, this is a good place to start.
America’s warm relations with Ethiopia date to the days after 9/11, when the country’s Christian-dominated government came to be seen as a natural U.S. ally in a region targeted by Islamic extremists. After disputed elections in 2005, however, Meles—once hailed by President Bill Clinton as part of a promising “new generation” of African leaders—began clamping down on dissent.
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Yet Washington tolerated his lapses because it needed his help fighting Qaeda-linked Islamists in next-door Somalia. In December 2006, Ethiopia’s U.S.-trained Army duly invaded its neighbor, ousting the radical Islamic Courts Union government there. But the adventure hasn’t worked out as planned. No sooner had the ICU been toppled than an even more radical group, Al-Shabab, sprang up to fight the invaders. And although Seyoum Mesfin, Ethiopia’s foreign minister, recently told NEWSWEEK that the Islamists have been militarily “shattered,” they now control much of the country’s south and have tightened links with Al Qaeda. Meanwhile, the Ethiopian troops have pulled out, and the country they left behind has been thoroughly devastated. Two years of fighting forced about 3.4 million Somalis, some 40 percent of the population, from their homes. Yet only a few high-ranking terrorists were eliminated, and Russell Howard, a retired general and senior fellow at the Pentagon’s Joint Special Operations University, says the occupation only “empowered” the radicals.
Such failures—and Ethiopia’s growing repression—suggest Washington should rethink the relationship. Just what Ethiopia offers the United States today is unclear. Addis Ababa has contributed troops to U.N. peacekeeping forces in Darfur and Burundi and plays a large role in shaping the policies of the African Union. But this shouldn’t earn it unquestioning U.S. support.
To reset ties, the United States should push Ethiopia to democratize. And it must urge it to reconcile with its archnemesis, Eritrea. Resolving the conflict between the two states is key to addressing a whole range of threats to U.S. interests. Tiny Eritrea won independence from Addis Ababa in 1993, but the two countries fought a 1998–2000 border war and relations have remained hostile ever since, in part because Ethiopia, with tacit U.S. support, has ignored an international ruling that redrew their border. Too weak to challenge Ethiopia directly, Eritrea has funneled support to its enemy’s enemies—including Al-Shabab and its America-hating foreign fighters. Eritrea also recently instigated a border conflict with Djibouti, home to an important U.S. military base.
Washington should thus push Ethiopia and Eritrea to make amends; better relations would mean an end to their proxy war in Somalia, which has helped turn that state into a Qaeda haven. Should it choose to use it, the United States has plenty of leverage. Most U.S. spending on Ethiopia goes for health and food aid, which aren’t easy to cut. But the Obama administration could make military aid and weapons sales contingent on Meles’s improving his behavior. The House of Representatives passed a bill in 2007 to do just that, but the measure died in the Senate without White House support.
Much will now depend on the man Obama has nominated for the State Department’s top Africa job, Johnnie Carson. Carson’s record is promising: while ambassador to Kenya from 1999 to 2003, he helped persuade longtime President Daniel Arap Moi to step down, clearing the way for multiparty elections. Should he bring similar pressure to bear on Washington’s new African ally, Birtukan, Ethiopia’s other political prisoners, Africans throughout the Horn and America itself would all benefit.
An internal feud between Ethiopian private exporters and the government caught the media spotlight recently but, as usual, limited journalism coverage derailed the attention off the fundamental issues.
FORT WORTH, TEXAS — Scott Brown traveled to Ethiopia in 2006 to watch over the adoption of Enoch, a 3-month-old, 5-pound boy with big brown eyes.
Few people outside Ethiopia have ever heard of Birtukan Mideksa. And that’s just how the government wants it. Since December, Birtukan has been kept in solitary confinement, one of hundreds of political prisoners there. Her apparent crime? Organizing a democratic challenge to the increasingly iron-fisted rule of Prime Minister Meles Zenawi.