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Secretary General’s Statement at the IACO Ambassadors Meeting on 16th August 2019, at Hotel Tiama, Abidjan, Cote d’Ivoire

Wednesday 21 August 2019

Excellencies,

Ladies and Gentlemen,

 

It gives me such great pleasure to address you this morning on matters concerning our common Organisation, the Inter-African Coffee Organisation (IACO) which will be making 60 year in December next year. On 7th December 1960, when I was hardly a year old, eleven heads of state of African coffee producing countries met in Antananarivo, Madagascar, and resolved to create a new organization to represent the interests of the African coffee producing countries. The Founder members were Angola, Cameroon, Central African Republic, Congo (RDC), Côte d'Ivoire, Dahomey (now Benin), Gabon, Kenya, Madagascar, Uganda, Tanganyika (now Tanzania). This was a time when a great wave of Pan-Africanism swept across Africa, as most of our countries were shaking off the shackles of colonialism. There was great need for African countries to speak with one voice concerning issues that affected their economic wellbeing and access to markets.

 

Today, IACO’s membership comprises 25 African coffee producing countries, the following additional countries joined: Burundi, Congo, Ethiopia, Ghana, Guinea, Equatorial Guinea, Liberia, Malawi, Nigeria, Rwanda, Sierra Leone, Togo, Zambia and Zimbabwe. Over the years, since the creation of the Organisation of African Unity, which was succeeded by the African Union, many Pan African organisations have come onto the scene, but IACO is one of the oldest inter-governmental organisations in Africa. It is also noteworthy that coffee continues to be an important economic crop in many of our countries and the issues at hand pertaining to the AU’s agenda of commodity-led economic transformation particularly make IACO significant and relevant to the discussions.

 

In 2018, a new strategic plan was launched with the following components:

Motto: Transformation of the African Coffee Value Chain 

Vision: A modernised, competitive, and sustainable coffee industry which focuses on quality and productivity that is beneficial to all players in the sector

Mission: To support the industrialisation of the African coffee sector and position Africa's coffee as the origin of premium coffee in the minds of consumers around the world.  

Supporting the mission, IACO’s four specific strategic objectives are:

 

  1. Strategic Objective 1: Provide a platform for dialogue and alignment of policies to support the development of African coffee in Member States.

 

  1. Strategic Objective 2: Coordinate Coffee Research and its Implementation in Africa:

 

  1. Strategic Objective 3: Create and enhance awareness on the development of African coffee and promote the participation of the public-private partnerships in the member states in joint activities that benefit from synergies and economies of scale:

 

  1. Strategic Objective 4: Build and strengthen the institutional capacity to provide strategic leadership, guidance and support for coffee development in Africa:

 

Although Africa is the origin of both Arabica and Robusta coffee, we have not yet taken full advantage of the immense opportunities in the global value chain. Thus, IACO has a key role in galvanising the members to take advantage of every opportunity that will help in leading to the transformation of the African coffee value chain. It is a tall order today, to take on this challenge, due to the scarcity of resources, as a result of the several competing priorities for funding by our member governments. This has called for a paradigm shift and innovative ways of addressing the challenge. First and foremost, we must address the issue of efficiency in the value chain, beginning with farm-level productivity, value addition and quality concerns. Some of the actions are at the national level, while in some cases a regional approach would be more cost-effective.

 

At the Secretariat, we have had to deal with formidable challenges, and have had some periods of serious financial constraints due to the non-payment of dues by some Member States. We call upon them to begin to take their commitment to this organisation more seriously, if they are to reap the benefits that will surely be coming. In the same breath, I would like to thank the Member States that have supported us in so many ways, beginning with our hosts, the Republic of Côte d'Ivoire. I hereby express my gratitude for the support that I have received.

 

I will now provide a brief report on five key areas.

 

The construction of the IACO headquarters

A request made to the government of Côte d’Ivoire in 2015 led to the donation of a piece of land of 6000m2 for IACO to construct its headquarters. The business plan was that this headquarters was to help in generating revenue to finance the Organisation’s activities and thus help achieve the original dream of its founding fathers. With the decision of the 55th Annual General Assembly, in Luanda, Angola, to give green light for the Secretariat to proceed with the plans of headquarters construction, financing for the project was the major hurdle. Finally, this was overcome when we obtained the suitable arrangement of a BOT (build, operate & transfer) partnership through which the project will be accomplished. I hereby wish to recognise Mr. Jean Baptiste Fofana of INVESTURE S.a.r.l., who is leading this effort. Also duly recognised are other members of his team, including Mr. Eric Diarrasouba and Mr. Jamal Fardon. A presentation of the concept will be made by Mr. Cedric Kouassi, immediately after my statement.

 

African Coffee Facility

Over a period of five years, we have relentlessly pursued the goal of establishing an African Coffee Development Fund. We have had many moments expectancy and then disappointment! We decided not to be discouraged. Last year, we commenced discussions with a new partner, the African Export Import Bank (Afreximbank) who we found to be very pragmatic and extremely supportive in the establishment of what we call the Africa Coffee Facility. They provided us very good advice and have held our hand in the process of now putting together our first Donors’ Conference which is to take place in Nairobi on 5th November 2019. There has been tremendous support from the Centre for Agriculture and Bioscience International (CABI) and the International Coffee Organisation, as well as the Kenya Government where the current Chairman of IACO is the Cabinet Secretary (Minister) of Agriculture of Kenya. The Minister will be the convenor of the Donors’ Conference and a number of potential donors and partners have expressed their support for our initiative. Our target is to raise USD950 million, for a 5-year intervention period, extendable to 10 years. Thus, we look forward to an historical landmark in the creation of the African Coffee Development Fund.

 

Promotion of domestic coffee consumption in Africa

It is a fact that African countries import a lot of processed coffee from Europe, Asia and the Middle-East. Unfortunately, the statistics on intra-African trade in processed coffee are not readily available, but to a limited extent, there is also some processed coffee from Africa that is traded within Africa. While the rest of the world is increasing its consumption of coffee, with the exception of Ethiopia, only a small proportion of coffee is consumed in the African coffee producing countries. However, the trend of proliferation of cafés in urban centres and the budding entrepreneurial movement in the African coffee value chain buttressed by the emerging African middle-class has great promise for the coffee industry.

 

According to statistics from the International Coffee Organisation (ICO), Africa exported about 12 million bags (or 720,000 tons) of green coffee per annum, on average over the last five years, but also imported a similar amount. This shows that there is potential in the African market to absorb all the coffee produced in Africa. It is for this reason that IACO found it necessary to expand its membership to include the African coffee consuming countries, mainly in North Africa, the Sahel region, as well as Southern and South-west Africa. Thus, today we welcome the Ambassadors and representatives from some of these countries. The creation of the African Continental Free Trade Area further accentuates the opportunity. This year, IACO launched a programme of promoting domestic coffee consumption, and two inception workshops have been held, one in Lomé for the Francophone community and the other in Addis Ababa for the Anglophone community. A baseline study on domestic coffee consumption is currently underway.

 

Recognition of coffee as strategic commodity of Africa

Coffee is produced by over 12 million households in Africa, largely on a subsistence basis. It accounts for significant foreign exchange earnings of a handful of African countries. Surprisingly, though having immense political and socio-economic ramifications in many countries, this crop had not been included in agricultural agenda of the African Union. However, after a few years of discussions and consultative meetings, the motion to include coffee on the AU’s agenda of strategic commodities is now finally well under-way. We hope that the next AU summit will unreservedly endorse this motion. We count on the support of IACO Member States when this matter comes up at the different levels of discussion within the AU.

 

Recognition of IACO as specialised Agency of the AU

In line with the recognition of coffee as a strategic commodity on the AU’s agricultural agenda, an application was made for IACO as an institution to be recognised as the AU’s specialised agency for coffee. However, this process is expected to take a little longer, as the AU Commission is undergoing re-organisation and restructuring. A critical review of affiliated agencies is being made, and it is believed that before too long IACO status under the AU will be clearly defined. The support of IACO Member States’ governments in this regard is greatly appreciated. This will greatly enhance IACO’s capacity and status in working with several partners in the interest of developing and transforming the African coffee industry.

 

Conclusion

It is imperative that IACO must take the bull by the horns. It is not an easy proposition, but for the sake of the millions who are dependent on coffee for their livelihood, we must be innovative and think outside the box. This is the idea of the IACO headquarters complex as a money-generating endowment is a great idea. It will provide the financing required for both operational and project-related support, while easing the burden on IACO member states, in reducing the amount of membership dues. The Africa Coffee Facility will be our direct way of supporting the coffee development agenda in Member States, and transformation of the value chain. These are revolutionary ideas and will need the continued support of the member governments. Finally, the new IACO Agreement now expands the frontier of cooperation to cover the entire continent and we look forward to welcoming the new members from the non-coffee producing countries of Africa. We continue to count on the support of the governments and their respective commitment in all these efforts.

 

I thank you all.

Frederick S. M. KAWUMA, PhD

fkawuma@gmail.com