Ethiopia's Government: Starbucks’ Affair is Over

In response to The Starbucks Affair

Addis Fortune
July 16, 2007

Binding the Terms of the Starbucks Agreement

Dear Editor,

Mr. Shlomo Bachrach’s commentary last week headlined, “The Starbucks Affair” [Volume 8, Number 375, July 8, 2007] contained numerous inaccuracies, some of which warrant comment. Mr. Bachrach, whose consultancy with Light Years IP ended in February 2007, has no firsthand knowledge of the negotiations that paved the way for the agreement reached between Ethiopia and Starbucks. His speculative remarks about this process and its upshot were wildly off the mark. What is more, his tendentious narrations and gratuitous scepticism raise serious issues of professional ethics.

Mr. Bachrach went so far as to cast doubt on the very existence of a binding contract between Starbucks and Ethiopia: “The announcement raises some questions. It does not say, for example, that an agreement was signed; only that it was ‘concluded.’ ” What motivates this line of interrogation is altogether opaque. Nevertheless, we are happy to oblige.

On June 20, 2007, representatives of the Government of Ethiopia and Starbucks signed a distribution, marketing and licensing agreement covering the designations of three of Ethiopia’s finest heritage coffees: Harar/Harrar, Sidamo and Yirgacheffe.

Ethiopians have every reason to take pride in the agreement reached with the world’s foremost specialty coffee company. It secures recognition of Ethiopia’s rights over its fine coffees, not only in countries where they are registered as trademarks, but also in those where applications for registration are still pending. The resultant extraordinary level of global publicity and support for Ethiopia has brought unprecedented recognition of Ethiopia’s coffees and unique position in the specialty market.

To cite just one example, Ethiopia has been invited to submit a proposal to be a portrait country to be showcased at the 2008 Specialty Coffee Association of America conference.

To be sure, there is more to the Ethiopian Coffee Trade Marking and Licensing Initiative than the dialogue with Starbucks. Starbucks is now one of 20 or so leading and respected United State (US) specialty coffee companies that have acknowledged Ethiopia’s legal position, already having signed legally binding agreements. All licensees are bound by their agreements to promote Ethiopia’s fine coffees. The details of the promotional agreements are commercially sensitive and cannot be made public. The licensees are, after all, in competition with each other and to disclosing such information would place them in a disadvantageous competitive position.

Significantly, Ethiopia’s new partners are developing promotion ideas for discussion with Ethiopian counterparts and these new marketing commitments are the result of Ethiopia’s success in negotiation.

None of this is meant to lighten the challenges that lie ahead. The conclusion of the agreement between Ethiopia and Starbucks is the beginning of the real work of redressing demand and supply side impediments to improving the livelihood of coffee growers and ensuring the bright future of Ethiopia’s priceless fine coffees.
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Samuel Assefa (PhD), Ethiopia’s ambassador to the US, and Getachew Mengistie, director general, Ethiopian Intellectual Property Office.