The move could help the country's coffee growers to earn some $88 million more per year.
Nestled in the hills of southern Ethiopia lies a resource that could catapult this nation forward: coffee.
Connoisseurs worldwide savor the beans from Yirgacheffe for their distinctive flavor. And at a time when more consumers are targeting specialty brews, Ethiopia is poised to reap the rewards of a product that commands $10 per pound in the United States.
But while upscale consumers are willing to pay top dollar for the beans, farmers in Ethiopia sell their product for a pittance – less than $1 per pound. "It's like growers of Dom Perignon Champagne getting the same price as growers of bulk wine," says Ron Layton, founder and chief executive of Light Years, IP, a Washington-based group that helps producers in poor countries get better prices.
But Ethiopia recently shook up the industry with a new tactic: trademarking its specialty coffees. Overcoming resistance to the idea from distributors – notably Starbucks – the country is hoping to empower its coffee industry to earn an estimated $88 million more per year, according to Oxfam America. The move could inspire producers of other commodities throughout Africa to harness branding and capture more value from the goods they sell to consumers in rich countries.
"It's quite innovative for a branding initiative to come out of the developing world," says Seth Petchers, the director of Oxfam America's coffee program. "It's about getting [farmers] to realize the value of what they have.
"It's a big deal," adds Mr. Petchers, noting that producers from other developing countries are already asking: " 'If Ethiopia can do it, why can't we?' "
Obtaining trademarks for coffee grown in Harar, Yirgacheffe, and Sidamo allows Ethiopia – the birthplace of coffee – to decide which distributors it will grant licenses to sell those specialty coffees, and under what terms. More control over distribution will boost Ethiopia's economy, which relies on coffee for more than 40 percent of its export earnings, according to Mr. Layton and others who specialize in intellectual property rights.