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food / travel

Cold Economics For Colombia's Coffee Growers

The country faces dramatic debt levels among small-scale coffee farmers, as prices fall on world markets. Some have suggested a fixed minimum price for this key Colombian export.

Small Colombian coffee growers cannot live solely off the production of coffee anymore
Small Colombian coffee growers cannot live solely off the production of coffee anymore
Santiago Montenegro

-Analysis-

BOGOTÁ — What to do about Colombia's coffee sector? The question arises at a time of low prices on global markets. For good reason, for a long time until the early 1990s, the Coffee Congress was considered almost as important as the National Congress. In those years coffee was by far the country's most important export — a place that has been taken by products like oil, minerals, and cocaine. Since that time, other big changes have occurred, including a shift in production areas from central and north-central zones like Antioquia, to the southern departments of Cauca, Huila, and Nariño. Also, more growers have joined the sector for whom coffee is not the main economic activity or source of income.

While coffee production was fundamentally the work of peasants until some 50 years ago, now many professionals living in cities have turned it into a secondary and often part-time activity or supplementary source of income. Half a century ago, the vast majority of rural families lived exclusively off the production of coffee and subsistence crops. But coffee growers are today fewer in number and are concentrated in the south of the country. One must consider these factors when analyzing policy options and aid to the coffee sector. In the face of low prices on world markets, the director of the Coffee Growers' Federation has proposed withdrawing Colombian coffee from the New York stock market or fixing a minimum sale price. This could be a very costly option and make Colombia lose market share.

The most urgent option is to restore an internal price stabilization mechanism.

The former finance minister, Mauricio Cárdenas, has suggested returning to a pact among producers like it used to happen until the early 1990s, though again its implementation would be very difficult. He has also proposed an interesting information tactic, to show consumers that producers like those in Colombia only receive 3% of the final price, even though they hold the most important position in the production chain.

Perhaps the most urgent option is to restore an internal price stabilization mechanism, like a stabilization fund that saves money in boom times and dispenses it when market prices drop. Two other options used in the past are to subsidize the internal purchase price and refinance or partly condone, the debts of growers. According to media, their debts to the Agrarian Bank stand today at 1.2 trillion Colombian pesos (a little over 338 million euros). As these options are also highly costly, they could be implemented if two objectives are met. One is to concentrate aid to peasant farmers and smallholders, and the second is aid against a program of increased productivity. As most production is now in the south of the country, these measures are also, ultimately, important in containing cocoa farming, which is also expanding in the southern departments.

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The Weight Of Trump's Indictment Will Test The Strength Of American Democracy

The U.S. legal system cannot simply run its course in a vacuum. Presidential politics, and democracy itself, are at stake in the coming weeks and months.

The Weight Of Trump's Indictment Will Test The Strength Of American Democracy

File photo of former U.S. President Donald Trump in Clyde, Ohio, in 2020.

Emma Shortis*

-Analysis-

Events often seem inevitable in hindsight. The indictment of former U.S. President Donald Trump on criminal charges has been a possibility since the start of his presidency – arguably, since close to the beginning of his career in New York real estate.

But until now, the potential consequences of such a cataclysmic development in American politics have been purely theoretical.

Today, after much build-up in the media, The New York Times reported that a Manhattan grand jury has voted to indict Trump and the Manhattan district attorney will now likely attempt to negotiate Trump’s surrender.

The indictment stems from a criminal investigation by the district attorney’s office into “hush money” payments made to the adult film star Stormy Daniels (through Trump’s attorney Michael Cohen), and whether they contravened electoral laws.

Trump also faces a swathe of other criminal investigations and civil suits, some of which may also result in state or federal charges. As he pursues another run for the presidency, Trump could simultaneously be dealing with multiple criminal cases and all the court appearances and frenzied media attention that will come with that.

These investigations and possible charges won’t prevent Trump from running or even serving as president again (though, as with everything in the U.S. legal system, it’s complicated).

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