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Coffee growers forced into poverty by low prices : The Standard

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Governor Anne Waiguru at the Kirinyaga coffee stand during the sixth devolution conference at Kirinyaga University. [Mose Sammy, Standard]

Global coffee growers are being forced into poverty by low international prices for the crop, farmers’ representatives said at an international conference, warning the future of the industry is at risk.

Coffee futures are near a 13-year bottom, trading as low as 93.45 cents per pound on Wednesday – far below the cost of production in most countries.
In a statement on Tuesday from Nairobi, Kenya, where the International Coffee Organization is conducting a biannual meeting, the World Coffee Producers Forum said New York market prices are “allowing the impoverishment of producers.”
“The current economic sustainability crisis of coffee producers needs to be addressed immediately before it becomes a humanitarian crisis,” read the statement, signed by producer associations from Colombia, Brazil, Mexico, India, Vietnam, Central America as well as across Africa.

SEE ALSO :Farmers sound alarm over poor crop yields

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Futures have been weighed down by excess supplies, particularly from Brazil, the world’s biggest and most efficient producer of arabica. The country last year produced a near-record arabica crop and is widely expected to produce another huge crop in the 2019-20 harvest year, despite it being an off-year in the biennial production cycle.
The price environment has accelerated momentum to find pricing alternatives. In January, a new platform for specialty coffee was launched in the hopes of eventually delinking fine beans from the futures price.
Colombia’s growers’ federation has suggested that high-quality producers untether their prices from the New York market, though traders were uncertain about the feasibility of the effort.
“An approach based on the principle of co-responsibility and total transparency must be implemented to ensure that all the links of the value chain are profitable and healthy,” the statement added.
“Coffee farmers from all over the world have been reaching out for years to the rest of the value chain hoping for a collective, constructive and realistic approach to secure the economic sustainability of producers. The response – unfortunately – has been very weak.”

SEE ALSO :Multimillion-coffee mill to begin operations next month

Desperation among growers is such that some are switching to illegal crops to make ends meet, a phenomenon already on display in Peru, whose federation said some growers have abandoned their crop to grow coca, the main ingredient in cocaine.
A survey from Rabobank earlier this month pegged Brazilian 2019-20 arabica output at about 38 million bags, which would be the largest for cyclical off-year.

CoffeeInternational Coffee Organization



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World Bank pushes G-20 to extend debt relief to 2021

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World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.

“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.

He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.

The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.

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People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.

For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.

Debt burdens, already unsustainable for many countries, are rising to crisis levels.

“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.

ALSO READ:Global Economy Plunges into Worst Recession – World Bank

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Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans

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The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.

“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”

According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.

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Tighter Reins on Platforms for Mobile Loans

The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.

Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.

Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.

SEE ALSO: Central Bank Unveils Measures to Tame Unregulated Digital Lenders

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Scope Markets Kenya customers to have instant access to global financial markets

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NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options. 

This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.

The Scope Markets app offers clients over 500 investment opportunities across global financial markets.

The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.

The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).

The platform also offers an enhanced client interface including catering for those who trade at night.

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The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour;  Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).

The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.

Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”

He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.

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