ETHIOPIA/USA: Starbucks reaches deal with Ethiopian government on coffee beans trademark

Record ID: 455043

  • Title: ETHIOPIA/USA: Starbucks reaches deal with Ethiopian government on coffee beans trademark
  • Date: 26th June 2007
  • Summary: VARIOUS OF PEOPLE DRINKING COFFEE AT COFFEE HOUSE
  • Embargoed: 11th July 2007 13:00
  • Keywords:
  • Topics: Industry
  • Reuters ID: LVAS1NY0CHXRLCZXJA7KG8JTG6P
  • Story Text: US coffee shop giant Starbucks and the Ethiopian government reach an agreement on Ethiopia's bid to trademark its coffee beans. Coffee giant Starbucks and the Ethiopian government reached an agreement on Wednesday (June 20) that settles a dispute over the country's bid to trademark its coffee beans
    Ethiopia, which prides itself as the birthplace of coffee, has been in dispute with Starbucks, saying the US coffee shop chain had tried to block Africa's biggest producer from trademarking its best-known beans.
    The agreement allows Starbucks to use and promote the Harrar, Sidamo and Yirgacheffe designations in markets where trademarks exist, as well as where they don't, according to the joint statement released in Los Angeles.
    The US Patent and Trademark Office awarded Ethiopia's Yirgacheffe coffee a trademark in 2006.
    Starbucks had previously stated that it would not oppose Ethiopia's efforts to obtain trademarks, but the agreement goes further, addressing distribution, marketing and licensing. It includes the license of certain trademarks and language that recognizes the importance and integrity of Ethiopia's speciality coffee designations.
    The agreement was good news for coffee exporters back in Ethiopia.
    "It is a very important issue on coffee that Starbucks has signed the agreement with the Ethiopian intellectual authority. Coffee exporters are very happy that at last Starbucks agreed on this trademark. And this trademarks will be very important to the Ethiopian coffee farmers. The producers will get much better prices for their product. Starbucks is a huge company, which used for long time Ethiopian coffee in the market that is the two size advantage and we are very happy for the signature of this agreement," said the Chairman Of Ethiopian Coffee Association, Abdul Razake Sherif.
    "The impact of this agreement is recognition that Ethiopian coffee and Ethiopia is the origin of Arabica coffee and we do the variety of coffee that appreciate coffee of the world. This hope will be the first step, in gaining more recognition and impact for our coffee in the world generally coffee market and many, many coffee is found in Ethiopia," said Coffee Exporter, Abdulah Bagersh.
    Currently, about two percent of Starbucks' coffee purchases are from Ethiopia, but the amount could increase as the company plans to raise its coffee supply from East Africa.
    In theory, the trademark agreement could boost income for Ethiopian farmers by allowing the country to negotiate purchasing conditions for coffee roasters or retailers that want to use that name.
    Aid agency Oxfam, which launched a campaign in October 2006 urging Starbucks to talk to Ethiopia directly on the issue, has welcomed the move, and had said earlier this year that the deal could be worth some 88 million US dollars to farmers.
    About a quarter of Ethiopia's 80 million people live off the coffee farming industry. The country's average annual income is around 1,000 US Dollars.
    The eyes of Africa will be on this agreement which could set a precedent for further deals within the continent. Oxfam says other African countries could benefit from following in Ethiopia's foot-steps by looking into trademarking.
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