Think of coffee and you will almost certainly think of
Brazil, Colombia, or maybe Ethiopia. It might surprise you but
nowadays the world's second largest exporter is Vietnam. The country
is actively exporting coffee, which grows in large areas. Its market
share managed to jump from 0.1% to 20% in just 30 years. How have
these rapid changes affected the country?
The Vietnam war ended in 1975, and economic policies
introduced by the government at that time did nothing to help.
Collectivizing agriculture proved to be a disaster, so
in 1986 the Communist Party placed a big bet, on coffee.
Coffee production grew considerably by 20%-30% every
year in the 1990s. Today the industry employs about 2.6 million
people. Coffee beans are grown on half a million smallholdings of
two to three acres each.
As we see this reform proved to be highly successful. It helped
transform the Vietnamese economy. For instance, in 1994 60% of
Vietnamese lived under the poverty line, today less than 10% do.
The Vietnamese
traditionally drank tea, like the Chinese, and still do," says
Vietnam-based coffee consultant Will Frith.
Vietnamese people do drink it - sometimes with
condensed milk, or in a cappuccino made - but coffee is mainly
grown as an export crop.
Coffee was introduced to Vietnam by the French in the
19th Century and a processing plant manufacturing instant coffee was
functioning by 1950.
Some big companies, like Nestle, have their processing
plants in Vietnam, which roast the beans and pack it.
Thomas Copple, an economist at the International Coffee
Organization in London, says most of the crop is exported as green
beans and then processed in other countries, in Germany for example.
Some local entrepreneurs in Vietnam are planning to
set up an international chain of Vietnamese-style coffee shops.
"We want to bring Vietnamese coffee culture to the
world. It isn't going to be easy but in the next year we want to
compete with the big brands like Starbucks," Chairman Vu says.
"If we can take on and win over the US market we
can conquer the whole world."
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