Starbucks agrees to pay premium price for Ethiopian coffees (Capital Ethiopia)

By Andualem Sisay and Kirubel Tadesse

A few months ago, Oxfam had accused US coffee chain Starbucks of denying Ethiopia more than 88 USD a year. Oxfam reported that Starbucks asked the National Coffee Association (NCA) to block the country's bid to trademark three types of coffee bean in the US but Starbucks had denied initiating any kind of opposition to Ethiopian trademark application.
It was also reported that the Ethiopian government filed its applications to trademark its coffee bean names - Sidamo, Harar and Yirgacheffe and at that time Oxfam claimed that Starbucks flagged up the application to the NCA, which then filed its opposition at the US Patent and Trademark Office.
After a months long dispute earlier this year, Starbucks has signed distribution, marketing and licensing agreements with Ethiopia and has agreed to assist in expanding consumer awareness of Ethiopia's coffee brands- Sidamo, Harar/Harrar and Yirgacheffe.
Howard Schultz, the Chairman of Starbucks who paid a three day visit to Addis Ababa this week with his senior officials, vows to pay premium prices for Ethiopian coffee.
Even if Prime Minister Meles showed no indication of agreeing that Ethiopia had gone the wrong routes to success; he seemed to be satisfied with the 'unprecedented decision' of Starbucks.
"All of the disagreements are behind us now because of the decision made by the chairman," said Prime Minister Meles, during a joint press briefing he gave with Howard Schultz, Starbucks Chairman, at the Prime Minister's office on Wednesday, November 28, 2007.
"He made an unprecedented decision in favoring our coffee farmers by recognizing their property rights. It has never done before for any other product from a country such as Ethiopia," he added.
"The issue of the trademark was never as contentious as it was reported," said Chairman Howard Schultz later on, in an exclusive interview with Capital on Thursday November 29, 2007 at Sheraton Addis.
He said: "We were having very positive discussions with representatives of the government for much of the past six months or so and the Ambassador has been to Seattle a number of times as have members of the coffee industry. Our interest has always been the same" .
Explaining the dispute, Schultz said: "The Ethiopian government wanted to potentially trade mark pieces of geography that stand for where the coffee is from, whether it is Harar or Sidamo or any other place and that is their privilege and their right. Starbucks as a company, we can't tell any government what to do or what not to do, we are just customers.
He added that the better way proposed was for Starbucks to be in total alignment with coffee farmers to build a partnership around sustainability, high quality premium coffee, and for that, Starbucks should pay a premium price for the coffee.
Starbucks has also indicated its readiness to support Ethiopian coffee farmers by opening a farmers support center in Addis Ababa in 2008.
The farmers support facility, which is the first in Africa and the only second after Costa Rica, is designed to enable Starbucks to work collaboratively with Ethiopian farmers to raise both the quality and production of the country's high quality specialty coffees.
During this visit, the chairman with his officials discussed the issue with some coffee farmers and coffee industry representatives.
Between 2002 and 2006, Starbucks increased its Ethiopian coffee purchases by nearly 400 percent. Today, Ethiopian coffee is found in nearly all of Starbuck's U.S stores.

Congratulations to Ethiopian government and Ethiopian coffee farmers

It is a great victory for all who have been supporting and standing by the Ethiopian government and Ethiopian coffee farmers to give the coffee farmers what they deserve - fair price for their coffee.

 

We are all glad and happy that Starbucks and Ethiopia have finalized a licensing agreement giving Ethiopians control over their specialty coffee brands such as Sidamo, Harar and Yirga Chefe.

 

We are all thankful to Oxfam who pressurized and pushed Starbucks to eventually compromise and reach an agreement. Well done Oxfam! 

 

 

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Dutch investor plans five-star hotel, real-estate development (Capital Ethiopia)

Dutch investor plans five-star hotel, real-estate development (Capital Ethiopia)

By Andualem Sisay

Absorbed by the current investment climate and opportunities in Ethiopia, a Dutch national is to invest over 40 mln USD on a five star hotel and real-estate ventures in Addis Ababa.
Mr. Cvan Hal and his Ethiopian wife, Mrs. Genet Abebe, have decided to live in Ethiopia after concluding their 18 year business in the Netherlands. They have now secured 50,000 square meters in Bole area for real-estate purposes and are expecting 4-5,000 square meters of land in the same area for the five-star hotel they plan to build.
"We decided to move to Ethiopia encouraged by the business opportunities and the climate of the country," says Mr. Cvan Hal, an Energy Engineer by profession who owns, along with his wife; Cool Force- a company engaged in the transport and energy sectors.
"The market opportunities in the Netherlands are minimal when compared to that of Ethiopia, as the European market features more competition.
There are lots of opportunities in Ethiopia for an investor," he said.
When completed, the two investments are expected to create 330 permanent jobs.
Commenting on the areas that need improvement in the relevant offices he has visited so far, Mr. Hal suggested: "to make the money transfer short, easy and simple for a foreign investor, the National Bank of Ethiopia has to have one section that deals specifically with letters of credit. "This will help to reverse the current long process that consumes three to four days of a foreign investor by rotating from one office to another."
He also indicated that the investment authorities and other offices that deal with foreign investors need to prepare a web-site or brochures in various international languages so as to save the time an investor wastes not knowing where to go, which process to accomplish first, how to go about it and what documents are expected.

Source: Capital Ethiopia

Black Gold : a documentary

After oil, coffee is the most actively traded commodity in the world with $80 billion dollars in retail sales. But farmers make as little as three cents for every cup of coffee sold in the U.S. or Europe. Most of the rest of the money goes to the middlemen, especially the four giant food conglomerates which control the coffee market. Black Gold sits in on the coffee auctions in Addis Ababa, London and New York where the fate of the coffee growing nations is decided. [Read more..]

Starbucks strikes Ethiopia deal (BBC)

Starbucks and the Ethiopian government have reached an agreement which could help end a dispute over trademarks.

The two sides agreed in principle to sign a licensing and marketing deal which recognises the importance of Ethiopia's speciality coffee beans. [Read more...]

Starbucks Picket at Cutty Sark Greenwich (Indymedia UK)

FIVE STARBUCKS WORKERS SACKED FOR FORMING A UNION
For almost 3 years workers in Starbucks have been organising in their franchises in the USA. Starbucks have responded by waging a war of intimidation against the unionising workers. Already 5 employees have lost their jobs – Joseph Agins, Charles Fostrom, Evan Winterscheidt, Daniel Gross (Founder of the Starbucks Union) and Isis Saenz. This is a warning shot towards anyone attempting to improve work conditions. However, Starbucks workers have fought back: winning 2 workers their jobs back and more than $2000 in lost earnings. In New York City, workers have gained a 25% wage increase in just over 2 years, with similar raises in other areas they have organised.
“PLEASE DRINK SOMEWHERE ELSE TODAY”
We are asking the public to drink their coffee somewhere else, to protest Starbucks unfair practises. We also offer our support and assistance to any Starbucks barista considering organising his or her workplace. Regular pickets will be held at various franchises throughout South London to highlight Starbucks’ attacks on its workers, and to show solidarity with the 5 sacked workers in the USA.
WHY ORGANISE AT WORK?
Almost none of us really want to go to work in the morning. We do anyway because the rent and bills need paying, and we want money for ourselves (and our families), and maybe even a little bit for a social life! Sometimes however, things at your job can really get to be too much. The pay’s too low, the workload’s too tiring and management is always on your back. For many people, the immediate solution would be to find another job – only to find it’s exactly the same.
But there is another option. Together, we can fight to make our working lives more bearable. Coffee baristas in the States did just that, working together to form the Starbucks Workers Union (SWU) together with the Industrial Workers of the World (IWW). Thus far they’ve organised 6 franchises in New York City alone, and Starbucks Union members exert influence in many other Starbucks outlets.
There are plenty of ways in which we can better our working lives. It could be as basic as covering for a workmate or as extreme as going on strike for better pay or hours. What’s important is that we stick together: working collectively for stuff that all of us want.
VICTORY IN THE USA, ORGANISING IN THE UK
The Starbucks Workers Union won a major victory over unfair labour practices, in a conflict between the world's largest coffee chain and the baristas who work there. Faced with the prospect of having its widespread union-busting campaign exposed in a public hearing, Starbucks agreed to remedy many of the violations committed against workers who have organised a union. Workers from Leicester in this country recently followed suit and created Baristas United, which is open to employees of any coffee shop.
ELSEWHERE…
The Starbucks Workers Union is calling for Starbucks to recognize Ethiopia’s development of premium coffee varieties. If the rights to names such as Sidamo, Harar and Yirgacheffe were recognized, coffee farmers in Ethiopia would get almost £50 million extra per year. see www.starbucksunion.org
SOLIDARITY
Only by sticking together can we improve our lives. The fired Starbucks workers sought to do that, and Starbucks are attempting to punish them for this. This cannot just be forgotten, and we must all stand together, and let Starbucks know they cannot get away with this. If you are interested in trying to organise, please speak to one of the people handing out these leaflets for information or a copy of our leaflet “Stuff your Boss doesn’t want you to know”.

This information produced on a leaflet by South London Solidarity Federation – contact: southlondonsf@solfed.org.uk

For further information, take a look at: www.solfed.org.uk ; www.starbucksunion.org ; www.iww.org.uk ; www.baristasunited.org.uk

IMCista

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Ethiopian Coffee Trademark Videos on YouTube

Robert Winter, a senior partner at Arnold & Porter, posted a video on YouTube explaining his view regarding the Ethiopian coffee trademark dispute associated with the names of three of its most famous coffee-growing regions.

The video posted on the site was a response to a video posted in December by Dub Hay, Starbucks Coffee Co. senior vice president, claiming the trademark and licensing scheme was illegal.

What's in a name? Ethiopia's battle against Starbucks (FP)

Ethiopia, fed up with getting short-changed when selling its popular coffee products to the West, has been in legal conflict with Starbucks since 2005. Ethiopia complains that while a pound of coffee sold in the United States nets Ethiopian farmers about $1, the same pound of coffee sells for $26 at Starbucks under the name "Shirkina Sun-Dried Sidamo." Ethiopia argues that the high price for its coffee is not just the result of roasting, packaging or marketing in the United States, but because there is something consumers intrinsically value in Ethiopian coffee. Ethiopia is frustrated that it hasn't been able to capitalize on the "intellectual property" of its coffee-producing regions, and wants that to change.

In March 2005, Ethiopia filed a case with the U.S. Patent and Trademark Office to trademark the names of three of its renowned coffee-producing regions (Yirgacheffe, Harrar and Sidamo), hoping that eventually the government will be able to force buyers into licensing agreements and thereby gain a bigger share of the sales. Starbucks, which had already applied to trademark Shirkina Sun-dried Sidamo, has been able to stall Ethiopia's progress by not responding to Ethiopia's request to drop its petition. Starbucks argues that Ethiopia should opt for "geographic certification" (used for Idaho potatoes and Florida oranges) rather than an outright geographic trademark. Ethiopia counters that it just doesn't have the resources to bear the burden of certification, and that it still wouldn't necessarily help Ethiopia earn more from coffee sold in those regions. Starbucks could still sell its Sidamo coffee for the same price—as long as it actually comes from Sidamo.

Starbucks sources only 2 percent of its beans from Ethiopia at the moment, accounting for around 2 percent of the Ethiopia's crop. Nonetheless, if Ethiopia wins its petition, it is likely to earn an extra $88 million in revenues. So for Ethiopia, there's a lot in a name.

Source: Foreign Policy

Decoding the ploy: Starbucks-Ethiopia joint statement

At the end of the week, a Starbucks-Ethiopia joint press statement made it out to the press. Starbucks has widely circulated this document on its website and through emails. The desired outcome is misleading the unsuspecting public. The joint press release from Ethiopia and Starbucks, no matter how tactfully drafted, shows that Starbucks has not changed its position. It is disappointing that Ethiopia would put its name on this release, which leaves the misleading impression that it has accepted Starbucks’ rejection of its trademarks. Of course, Ethiopia cannot force Starbucks to accept the trademarks. But was it necessary to publicly accept this rejection? Wouldn’t it have been better to issue separate statements?

This outcome looks like a public relations victory for Starbucks. The company said it would no longer oppose Ethiopia’s trade mark applications, which it has aggressively done, and denied. It has offered charity and some technical assistance to buy good will, and made promises to buy more coffee in Ethiopia. It claims to have the welfare of the farmers in mind. If it really had the farmers in mind, it would pay them a fair price based on what they sell the coffee to their customers.

Will Starbucks buy more coffee from Ethiopia? Starbucks refuses to reveal how much coffee it buys from Ethiopia today, and since it buys through third parties, it is impossible to know the quantity. It will be impossible to verify a claim that they increased their purchases. In other words, Starbucks is making an empty, unverifiable promise.

Starbucks says it will support technical assistance to improve the quality of the coffee produced in Ethiopia. But this will help Starbucks more than it will help the farmers. Starbucks is expanding and needs more high quality coffee. It will make big profits if the farmers increase their production of this coffee. The farmers, however, will continue to get the same small percent of the profits. It is unacceptable that Ethiopia would put its name on such a press release. Still, it should issue its own press release with an account of what has and hasn’t gone right. But what has exactly happened last week? [Read more..]

Starbucks won't oppose Ethiopia's efforts to obtain trade marks for its specialty coffee: joint statement (Walta)

Addis Ababa, February 19, 2007 (WIC) – Starbucks will not oppose Ethiopia’s efforts to obtain trade marks for its specialty coffee--Sidamo, Harrar/Harrar and Yirgachefe--and respects the right and choice of the government of Ethiopia to trademark its coffee brands and create a network of licensed distributors, a joint statement issued yesterday by the government and the company disclosed.

According to the joint statement released here and in Seattle (USA), though both parties recognize that there are differences in approaches to achieving this shared vision, Starbucks has indicated that it respects the right and choice of the government of Ethiopia to trade mark its coffee brands and create a network of licensed distributors.

The parties have also agreed to collaborate in meeting their shared vision to increase the income of farmers and ensure sustainable production of fine coffee, it said.

Starbucks has accordingly agreed to double its purchase from East Africa and increase its purchases from Ethiopia. It will also provide technical support and capacity building to Ethiopian farmers through a farmer support center that it will open in East Africa, the statement pointed out.

The farmer support center will be staffed with agronomists who will work with farmers to improve quality yields and prices received, it was stated.

Starbucks has further pledged to expand its micro credit facilities in East Africa to help farmers in their farms.

The joint statement further added, both the government of Ethiopia and Starbucks will continue to strengthen their partnership and engage in consultation on strategies to improve the lives of Ethiopian coffee farmers and their families.

Source: Walta Information Center

Starbucks rejects Ethiopia’s trade mark claim (Walta)

Addis Ababa, February 17, 2007 Starbucks, an American coffee retailing company, yesterday announces that it is strengthening its relationship with Ethiopia but insisted not accept the country’s claim of trade mark to its fine coffee.

In a press conference held at Sheraton Addis yesterday, Company Vice President Alian Poncelet told journalists that his company has agreed with the government of Ethiopia: “Only to work together in future relationships”.


“The recent agreement is work together. This is the agreement we have agreed,” he said.


“We have also talked about o the execution of recent pledges made by Starbucks to the benefit of African coffee growers.


Asked whether the two parties have signed an agreement on patent right, the Vice President said: “We didn’t sign any agreement on Ethiopian coffee trade marks.”


Citing, the company’s recent pledge to increase its coffee purchase in Eastern Africa two –fold over two years, Poncelet said,: “We are not taking about price but quality.


Also yesterday, the company announced plan in which it believes help African coffee farmers.


Meanwhile Government official told journalists that Ethiopia wants to see the practicality of Starbucks’ plan and its impact on Ethiopian farmers.

Source: Walta Information Center

Ethiopians' dispute with Starbucks keeps brewing (Marketplace)

Starbucks has been accused of blocking Ethiopian farmers' attempts to trademark their coffee beans. A group representing Africa's top coffee growers is now backing the farmers' efforts. Stephen Beard reports.

TEXT OF STORY

KAI RYSSDAL: If you go to the Starbucks website, it tells you coffee as a drink originated in Ethiopia more than a thousand years ago. And right about here is where irony meets the news of the day.

Ethiopia's been trying to trademark some of its beans. Starbucks has been accused of blocking that process. And today, a group of major African coffee-growing countries took sides. From London, Marketplace's Stephen Beard has more.


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STEPHEN BEARD: A group representing Africa's top coffee growers today attacked Starbucks. It urged the company to drop its opposition to Ethiopia's campaign to trademark some of its coffees in the United States.

The British charity Oxfam has endorsed that trademark campaign. Oxfams' Chris Jochnick says it will bring vital help to a country where most people live on less than $2 a day.
CHRIS JOCHNICK: What this initiative tries to do is to give those farmers the leverage to control and manage the names of their coffees in order to be able to derive more value from the sale of those coffees.
Starbucks denies that it's tried to block Ethiopia's trademark applications. But the company's Sandra Taylor says Starbucks does not believe that trademarking is the best way for the Ethiopians to improve their standard of living.
SANDRA TAYLOR: Well, we respect the Ethiopian government's right to choose the direction that works for them. For us, we believe that it's most important for farmers to focus on quality. And that's why we have undertaken the kind of programs we've announced for East Africa.
Starbucks is planning a support center to advise coffee farmers on how to improve the quality of their beans. And the company is putting more money into health, education and water projects.

Entirely laudable, says Oxfam. But the group says it would be much better to let the farmers trademark their produce, giving them more control over the price and more earning power.

In London, this is Stephen Beard for Marketplace.

Source: Marketplace

Starbucks is 'Flat wrong' in calling Ethiopia’s licensing efforts illegal (Capital Ethiopia)

By Groum Abate

Top U.S. law firm Arnold & Porter LLP refutes Starbucks’ VP claim that signing a license agreement with Ethiopia would be against the law.

Starbucks is misleading the public by claiming that Ethiopia’s efforts to trademark its prized coffee brands and license international distributors are illegal, says Robert Winter. Winter is partner at the Washington DC-based law firm Arnold & Porter LLP which has been advising Ethiopia in these efforts. Winter stated publicly on February 9: “There is nothing illegal or unlawful about Ethiopia's program to obtain trademark protection for its coffee marks.” And he went on: “Moreover, there is nothing unlawful about Starbucks entering into a license agreement that acknowledges Ethiopia's trademark rights. To make this claim is flat wrong. Indeed, we believe that Ethiopia already enjoys effective trademark rights in its marks through widespread use of those marks for more than 75 years.”

Winter’s statement is a direct response to the claims by Dub Hay, Starbucks’ VP for coffee procurement, made on YouTube. This false claim is the latest in a series of misleading statements made by Starbucks since Ethiopia first approached the company in early 2005. Further, Starbucks’ representatives continue to state publicly that they know what is best for Ethiopian coffee farmers and refuse to acknowledge Ethiopia’s right to own and protect its valuable intellectual property in this way.

Ethiopia is reaching out to the specialty coffee industry worldwide with an invitation to enter into dialogue with the EIPO and to help shape a long term, mutually beneficial branding and distribution strategy for these coffees.

Of the current status of negotiations with Starbucks, Winter remarks: “Starbucks has expressed some concerns about the specific terms of the license Ethiopia has proposed and Ethiopia is prepared to enter into discussions to try to address those concerns, but there is no point in doing so while the company objects in principle to Ethiopia’s ownership of trademarks.”
“Ethiopia views trademark registrations as important business assets that will better enable it to manage the distribution of its coffees and to establish an effective distribution network”, Winter stated.

Ethiopia’s innovative Coffee Trademarking and Licensing Initiative is set to put Ethiopia’s producers and exporters on a more equal footing with their international buyers and improve the long-term market prospects for these coffee brands. Cooperation and support from buyers at this time demonstrates significant corporate social responsibility, given the critical importance of coffee income to more than 15 million people who earn their living by producing and supplying Ethiopian coffee.

Source: Capital Ethiopia

Oxfam takes on Starbucks (The Minnesota Daily)

The conflict over naming rights offers insight on grassroots limitations.

You might want to think twice about buying your next latte from Starbucks. Or at least the international agency Oxfam believes you should. The organization is on a mission to strong-arm the world's largest coffee retailer into giving Ethiopian coffee farmers a better deal. The campaign offers an important lesson on why these movements work and, at the same time, why they don't.
According to Oxfam, the Ethiopian government tried to get Starbucks to sign an agreement that would allow Ethiopians to retain ownership of their coffee names. Even though it sounds trivial, the distinct names of Ethiopian coffee - Sidamo, Harar and Yirgacheffe, for instance - offer a distinct advantage in the marketplace. According to Oxfam's statistics, this move could generate an additional $92 million in profit for Ethiopia.

Of course, the agreement would certainly cost Starbucks money. Ninety-two million dollars doesn't just appear out of thin air. Starbucks would end up paying more for Ethiopian coffee because the names give the coffee an added value. The question comes down to where the money should go. On one side, Wall Street investors and the largest coffee retailer in the world. On the other side, Ethiopian farmers who make almost nothing. Then, factor in the knowledge that only 10 percent of the money it costs for a cup of this quality coffee goes to Ethiopians, and the decision is clear.

Sure, the ideal solution would be to give the impoverished nation of Ethiopia exclusive naming rights. But the problem is that most consumers don't care enough to know about where their coffee comes from and how much the people are growing it are paid.

In some respects, one of the best ways for grassroots activists to change the world is for them to give up grassroots activism. This is not to say that this type of activism is ineffective or unimportant; countless examples indicate otherwise. But sometimes we forget that the power to change the world so often exists in the institutions most activists don't dare to associate with - for example, multinational corporations. Somewhere out there, someone drinking fair-trade coffee just cringed.

Source: The Minnesota Daily