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MUMBAI, May 30

IN its desperate search for solutions to the ongoing crisis among coffee-producing nations, the International Coffee Organisation (ICO) has decided to draw the attention of participants at the G-8 summit in June to the issues affecting coffee sector. The issue of commodity trade is on the summit agenda.

Earlier, on May 19, the ICO held a high-level Round Table in cooperation with World Bank to discuss possible ways of dealing with the crisis. Participants at this event included key leaders responsible for coffee in Governments, the private sector and civil society.

In the late 1980s, coffee- producing countries earned around $10-12 billion annually from coffee exports, but the earning have now halved to around $5 billion.

Slow rate of increase in consumption and substantial rise in production have combined to result in a steep fall in incomes for many producers. It was generally recognised at the round table that a totally free market in coffee entails excessive social costs and that some form of deliberate and concerted action with an impact on the market should considered.

The main areas that require support, both of a political nature and in terms of allocation of resources by industrialised countries and donor institutions include: redressing the supply-demand imbalance by increasing consumption, promoting diversification to reduce excessive dependence on coffee and development of local processing capacity.

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