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Jan 10, 2012

France’s AFD, IDB’s FOMIN fund project to boost Haitian coffee production

With additional contributions from Colombia and Nestlé

The Inter-American Development Bank’s Multilateral Investment Fund (FOMIN) and France’s Agence Française de Développement (AFD) will provide approximately $3 million in grants for a project to increase the output and upgrade the quality of Haitian coffee, improving the incomes of at least 10,000 smallholder farmers.

FOMIN’s Donors Committee recently approved a $1.9 million grant for the project, which will be carried out by Agronomes et Veterinaires Sans Frontières (Agronomists and Veterinarians Without Borders), a French non-profit organization that has been working in Haiti since 1999 and is already active in two coffee-growing regions.

The project will receive an additional grant from Colombia’s government, which will enable the Colombian Coffee Growers Federation to assist their Haitian counterparts, the National Coffee Institute and the National Platform of Coffee Producers. Nestlé, the world’s largest food and nutrition company, will participate in the partnership by providing technical assistance and planting materials to help Haitian farmers renovate their coffee trees.

“We see real potential for the coffee sector in Haiti to boost production for local consumption and for exports. This project takes a well-designed, comprehensive approach to address the range of obstacles that weigh on production and coffee value. Thousands of small farmers will benefit,” said FOMIN General Manager Nancy Lee. We are committed to successful implementation of this project and of our other intensive work in Haiti. With the resources that we and our partners bring to this effort and with the hard work of Haitian farmers, together we can restore Haiti as a world-class coffee producer.”

“AFD will help finance this program with a €900,000 grant to directly benefit coffee growers’ cooperatives in central and southeastern Haiti, complementing the activities backed by FOMIN in other areas,” said AFD’s director in Port-au-Prince, Yves Malpel. “These funds will be especially focused on training to strengthen partners’ management capabilities, as well as to provide assistance and advice on coffee production and transformation, in order to increase the value of their beans.”

Until two decades ago, coffee was Haiti’s principal farm export, representing as much as 70 percent of its foreign agricultural sales. A combination of international and internal factors contributed to a sharp decline in output, which was compounded by a persistent lack of farm investment. As a result, exports shriveled from 191,000 bags in 1990 to 16,000 bags in 2009.

The project will work with farmers in regions with potential to grow premium coffee in the North, Central, Southeast and Grand’ Anse departments. Its components will address some of the key issues in the coffee value chain, from increasing production to improving quality controls and strengthening the management of farming cooperatives and producer organizations.

The project will also leverage resources from other IDB-financed rural development programs in Haiti, including one for agricultural technology transfers and one for natural disasters mitigation. Coffee farmers will receive subsidies from these programs to replant and regenerate their older trees.

One of the project’s principal goals is to raise yields of coffee and other staples grown by Haitian farmers in “Creole gardens,” strengthening their families’ food security. With appropriate investments and cultivation techniques, their coffee output could double.

A key component of the project seeks to improve how Haitian cooperatives and producer networks process coffee beans in order ensure consistent quality, ultimately leading to a drop in rejection rates, which are at least double the Latin American benchmark of 10 percent.

By beefing up their business administration capabilities, Haitian coffee grower organizations will be able to reduce their costs of collection, processing, transport and exporting, which are twice as high as those of Andean coffee cooperatives.

The project will also provide grants to help cooperatives diversify their services beyond the marketing of green coffee, for example by organizing group purchases of agricultural inputs or the leasing of farm equipment, and by getting involved in the business of roasting coffee for local markets.

In order to disseminate the experiences and lessons learnt from this project among more Haitian farmers, the project will finance various knowledge and information products, including a visual “how-to” guide in Creole with recommendations on how to cultivate coffee and other crops.

Agriculture is a priority sector for the IDB’s work in Haiti, where nearly half of the population is rural. IDB grants are currently financing programs totaling $150 million in support of Haiti’s national rural development plan, supporting investments in irrigation, farming extension services and technology transfers, pest and disease control, watershed management, and land titling, among other activities.

About FOMIN

Established in 1993, the Multilateral Investment Fund supports private sector-led development benefitting the poor—their businesses, their farms, and their households. FOMIN projects seek to give low-income persons tools to boost their incomes: access to markets and skills, access to finance, and access to basic services, including green technologies.

About AFD

Agence Française de Développement is the French government’s overseas development finance institution. Founded in 1941, AFD supports projects that improve living conditions, promote economic growth and protect the environment throughout the developing world. In 2010 it authorized €6.8 billion in loans, guarantees and grants.

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