How a small company built a global coffee brand

By on September 4, 2013

A Good African Story

Trade not aid is the cry of a Ugandan coffee grower in a vivid, personal critique of the barriers to growth in his continent. Harriet Lamb applauds his vision.

Years ago in Kenya, visiting Fairtrade smallholders growing top-quality coffee, I was shocked to find that the hotels offered only Nescafe sachets. Andrew Rugasira, who was raised and lives in Uganda, in telling his story of setting up Good African Coffee, is likewise shocked and angry.

A businessman – and a good man – his book analyses why Africa is still battling so much poverty. He is angry about the distortions of aid, which have, he says, stifled the continent’s entrepreneurs, creating a ‘chronic dependency’ rather than stimulating sustainable economic growth.

Powerful donors have demanded concessions and pushed Africa’s leaders to be more accountable to them than to their own people. He is angry at how Africa’s leaders have failed their people, outlining how weak political institutions undermine entrepreneurs, who have to struggle with poor infrastructure, poor governance, and the poor delivery of the services that they need.

He rails against the colonialism that left structural inequalities and in particular promoted the exploitation of labour through the export of primary commodities such as cotton and coffee. And, while believing passionately in the brand’s tagline, Trade not Aid, he is angry about the inequities bedevilling trade. With sharp analysis and hard facts, he outlines the structural imbalances surrounding trade from Africa, including the tariff and non-tariff barriers.

For example, only 18.6% of Africa’s exports are manufactured or value-added products, meaning 80% are in raw form. Yet 65% of the continent’s imports are manufactured. It is his refrain that ‘we are producers of what we do not consume and consumers of what we do not produce’.

That’s what he sets out to change. In Uganda, some one million households grow coffee. Yet for years, as he says: ‘Uganda, which is the world’s fifth largest exporter of coffee, didn’t process any of its coffee beans but instead imported finished products.’

As a result, he calculates that less than 0.5% of the value of processed coffee sold in a cafe is retained by farmers. Turning his anger to positive effect, he sets out, as he proudly claims, to be the first African-owned coffee brand to be listed in UK supermarkets and finally opens a coffee-roasting plant in Kampala.

The book is best when he tells his own stories – from the terrifying childhood scenes when the army arrests his father through to meetings with sceptical farmers. He relates how they complained of delayed payments, exploitative middlemen, low prices and a neglect of agronomy.

These he sets out to correct through three main interventions: knowledge transfer (agronomy training), technology provision (hand pulpers and new varieties) and institutional capacity building (saving schemes).

His argument is that farmers are his partners and ‘investing in them is investing in our future. It is smart business’. He brings alive the killer problem facing him and farmers and entrepreneurs the world over – access to credit. According to a 2010 World Bank report, only 28 people per 1,000 borrowing adults in sub-Saharan Africa get access to credit.

He describes the nailbiting pressure as the bank constantly rings to chase his debts, the tension and fear as foreclosure notices arrive, and he makes trip after trip to the UK chasing a supermarket listing. But he falls into the very trap that he accuses the Western media of: the book is an eloquent exposition of the problems that constrain entrepreneurs in Africa, but we hear much less about the many and varied success stories.

He rightly says: ‘I am often amused when I hear policy experts talking about Africa’s need for more entrepreneurs. The problem is definitely not a lack of entrepreneurs – not if you have ever driven through the bustling streets of Lagos or downtown Nairobi or witnessed the thousands of entrepreneurs in Kampala’s suburbs who bring their wares to you.’

Too many loose ends are left dangling. He writes at length about getting a listing – but never mentions the pain of being delisted even though that is the sad reality. I was not going to mention Fairtrade but, to my surprise, Rugasira launches into a critique. Contrary to what he states, Fairtrade is as much a farmers’ movement – it was started by Mexican coffee farmers – as of consumers; we campaign tirelessly against structural trade injustices and we also focus on quality.

We agree with his analysis of the problems in trade and on most solutions, although we put greater emphasis on smallholders’ organisations. So there is far more uniting us than dividing us. I wish Rugasira well in fulfilling his brave vision, and this book about good coffee is a good read.

Book Review By Harriet Lamb is CEO of Fairtrade Internationa

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