Coffee is only exceeded in terms of trade by petroleum, and around the world it is responsible for providing over 25 million farmers with the funds required to survive. However the manipulation of worldwide coffee prices that goes on leads to extremely harsh living conditions for millions in countries which depend on coffee exports, and this has become a very important issue for the WTO to deal with. It is a very popular drink with many people making it in there homes on home coffee machines like the Delonghi EC155 espresso maker, or getting their daily fix from Starbucks.
One of the biggest problems is that too much coffee is grown, and with more than 40 million excess bags of coffee on the market, production is outdoing the current rate of consumption. This has resulted in a decrease in the price of coffee. For example, 5 years ago in Ethiopia a pound of high quality Arabica coffee beans would be worth around $1.50, now it’s worth less than a dollar. This means that Ethiopia is losing double that which it gains in debt relief. This is forcing some communities to starvation levels and deaths due to malnutrition have already been reported.
Unfortunately it is the wider policies of the US and EU that helped to cause this predicament. It can be directly linked to the World Bank and western demands. Poor nations that were not previously involvred in the coffee market were advised by the New York global development bank to start growing coffee. For example vietnam went in 10 years from not being involved to being the world’s 2nd largest producer of coffee after Brazil.
One solution to the problem that is currently being blocked by the EU and America, is enabling poor African countries to process and roast the coffee themselves as it is more valuable this way. But tariffs set by Europe and America make it uneconomical for these countries to do so. It is estimated that Africa could work its way out of poverty if it were allowed to do this, but to a certain extent it is being deliberately prevented from developing further, and many analysts agree that the global markets are being kept in conditions that favor the rich.
This is why it is imperative that the WTO get involved in attempting to right this current injustice.