Coffee: Providing An Economic “Jolt” To South Sudan

Courtesy of the Financial Times, an interesting report on coffee’s importance to South Sudan:

Four years after independence there is very little to celebrate in South Sudan. Border and land disputes continue to strain ties, and given other high-visibility emergencies the civil war is not the subject of much attention from international media. However, there is a small good news story amid all the conflict in the form of new investment in agriculture as a means of providing livelihoods and promoting peace. It turns out that sustainable agriculture, particularly coffee, can be an important building block for peace and development in Africa.

But first, let’s remember the African context in which South Sudan is lodged. There are now a billion people in Africa, 60 per cent of whom are engaged in agriculture. Agriculture is indisputably the greatest potential engine of broad-based development on the continent. It is critical to connect those farmers to the regional and global economy for real wealth creation rather than just knife-edge subsistence. Every job created in African agriculture supports 10 people. Women are at the core of this, as they spend money earned on food, health care, and education.

South Sudan has oil, minerals and other natural resources. Much has been said, for good reason, about Africa’s “resource curse”, by which countries blessed with natural resources have been riven by conflict and kleptocracy, the twin scourges of post-colonial Africa.

After a peace agreement ending Sudan’s north-south war in 2005, both Sudan and South Sudan hitched their economic wagons almost exclusively to oil, and a corruption-fuelled feeding frenzy began in both countries. In South Sudan, the lack of economic diversification and total reliance on oil have contributed to a resumption of war. Oil revenues had been captured by competing factions in the Juba government to fund rival patronage and security networks. Before the war began at the end of 2013, international banks warned that heavy dependence on oil made South Sudan vulnerable, and pressed for economic diversification, particularly into agriculture, given its high potential for igniting economic development.

Peace talks have largely failed. Much more than a ceasefire is needed to give peace a chance. Sustainable agriculture is one such pillar for peace. The more that alternative livelihoods and wealth-generating opportunities exist, the more people can sustain themselves without being tied to the corruption-fuelled spoils of the state. Specifically, specialised agriculture like coffee can benefit communities directly without the corrupt state intercepting the benefits, thus moving incentives away from the war economy.

The potential is huge. A 2012 World Bank study found that South Sudan was using 4 per cent of its crop land for a value of $800m. If that amount were increased to 10 per cent, and if land practices were improved, the total value would jump to $3bn. Research by Paul Collier at Oxford University has shown that states emerging from conflict that do not invest in agriculture and food security are usually the likeliest candidates to go back to conflict again.

There are numerous examples of how coffee production in particular has made a real difference in war-torn countries. Eastern Congo, Rwanda, Ethiopia, Columbia and Mexico all have shown that in a conflict or post-conflict situation, investing in high-value coffee production can also provide an anchor of stability and economic diversification for the country. Three initiatives are noteworthy for their responsible sourcing and connection to high profile ambassadors who can accelerate positive returns: Nespresso’s work with George Clooney in South Sudan and other African countries; Hugh Jackman’s Laughing Man coffee sourced from Ethiopia; and Ben Affleck’s Eastern Congo Initiative and its budding partnership with Starbucks.

South Sudan’s example is particularly impressive. Coffee investment offers communities in the hills and mountains of Equatoria a level of prosperity and development never before experienced in rural South Sudan. Historically, mining has been exploitative, oil provides little local employment, and most subsistence agriculture is inadequate to feed families and ends up driving young people to cities or to militias in search of a prospective livelihood. Few professions provide a legal, non-exploitative, and sustainable avenue for wealth creation, individually or communally. Specialised agriculture provides one of the few options, and coffee is one of the best of them.

Nespresso and TechnoServe have created a partnership to invest in rebuilding South Sudan’s coffee sector with the intent of doing well by doing good. They are creating livelihoods and anchors of stability while producing a high quality market-driven product.

Nespresso is financing agronomy support to coffee farmers to improve their farming practices and tree planting. The partnership with local coffee producers allows Nespresso and TechnoServe to make a real contribution to building the nation, especially at its darkest hour, providing new sources of sustainable income. Commercial diplomacy can play a crucial role in peace building in South Sudan.

As George Clooney has said: “The investment by Nespresso and TechnoServe in South Sudan’s coffee sector is helping to lay a foundation for a future South Sudan built on peace and prosperity, where wealth is created and shared for the benefit of the people.”

In an unstable situation where most investors and companies won’t take a risk, Nespresso and TechnoServe are plunging in and creating value and wealth that didn’t exist before. What that ultimately provides these communities is dignity and hope, and no price tag can be put on that.

This entry was posted on Monday, September 7th, 2015 at 7:36 am and is filed under Uncategorized.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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