Market – Driven Development in Burundi
Published: Thursday, 26 Apr 2012
For the first time in Burundi’s 80-year history of coffee production, the once war-torn, African country is producing specialty coffee to be sold direct to the markets, thanks to training and research provided by Michigan State University.
“It’s about privatization,” said Dan Clay, director of MSU’s Institute of International Agriculture. “It means improving product quality, engaging specialty coffee buyers and the government giving up a stream of revenue from trading commodity-grade coffee.”
This hasn’t been easy for the Burundi government, who witnessed the growth of the coffee industry in other countries, like Rwanda.
Rwanda transitioned through its post-conflict period and neighboring countries privatized coffee and other government owned industries, while Burundi was embroiled in a 13-year war. The country has fallen behind and now must move quickly to catch up.
MSU’s success in turning around Rwanda’s coffee sector in recent years has motivated Burundi to engage the university and its partners in a similar capacity.
“Burundi has the potential to restructure and offer a highly competitive product in specialty coffee markets,” Clay said. “But it needs producer incentives to raise quality and at the same time must establish market linkages and a recognizable image to successfully manage its transition away from the price sensitive commodity markets and into direct specialty sales.” A small supply of specialty coffee produced in 1998, was not able to build-up the industry and successfully address these challenges.
Currently, MSU is hosting buyer tours and working with growers at pilot sites to make changes in harvesting and processing techniques to ultimately create a better product. And a better product means coffee can be sold directly to buyers in a free-market system where prices are higher and often more stable than in the traditional commodity auction.
The primary vehicle for this effort has been through the Burundi Agribusiness Program, a five-year program sponsored by the U.S. Agency for International Development and conducted in close partnership with Development Alternatives, Incorporated.
A new approach—the changes have already translated into collaboration and sales among buyers and producers. As the first step in a relationship-building process, many coffee roasters and importers have already surveyed Burundi’s washing stations and met some of its growers, processors and exporters.
In a parallel step, the government has recently begun to receive offers from private sector bidders as it sells off the country’s 133 state-owned washing stations.
“Consistent with our mission, this project allows us to do what we do best: bring industry and community members together with improvements in science and technology to address hunger and poverty, one of the great global problems of our time,” Clay said. “And, in the end, Burundi will have built a free market industry around its largest cash crop and export.”