View Full Version : Success story of nationally-owned coffee exporters by James Kila

20-07-2003, 09:13 PM
THE COFFEE Industry Corporation Ltd (CIC) has already set in place its policy to encourage the growth of small nationally-controlled exporting companies.

This is one of the success stories of the often-criticized CIC, an organization which has withstood many onslaughts from interest-groups over the years.

Over past decade there have been a number of failures in this sector, but today companies such as Kongo Coffee Exports Pty Ltd, Nama Coffee Exports Ltd, Kosem Coffee Exports Ltd, Macoes Pty Ltd and Monpi Coffee Exports Ltd….all are trading successfully, having developed a presence and a strong relationship with buyers in the overseas market place.

Other companies such as Kundu Coffee and Niugini Coffee Tea & Spice Co, Ltd are partnerships involving national and overseas interests, and here shares are available for further take-up by PNG national institutions and organizations.

The only factor which holds these companies back is the lack of working-capital from the PNG banking industry. And what small amounts are lent, are lent at interest rates which penalize these companies severely in comparision with the two dominant foreign-owned exporters operating in PNG, which both have access to hard-currency financing at less than half PNG interest rates.

The massive financial failure of several exporting companies in recent times has sent danger signals to our banker is true. However, CIC is determined to overcome this situation and bring about change so as to facilitate the operation of the local exporters on an equal basis with their foreign-owned big brothers.

Another avenue towards independence which is being looked at seriously is the formation of a grower-owned marketing organization which would act as a middle-man for dedicated coffee growers, ensuring that these members achieve the best price possible for their product, and providing both the expertise and the working capital for the scheme to work. Such an organization would initially work through one of the established local companies and later either buy into this organization or set up its own export agency.