PEARL update

Again, stay tuned... we have a podcast interview scheduled with the Head Cheese of the PEARL Project tomorrow (Monday)... in the mean time read this :

A Partnership to Enhance Agriculture in Rwanda through Linkages: PEARL
(prepared by Dan Clay, Tim Schilling, and Anne Ottaway, of PEARL)

PEARL Background: PEARL is a USAID funded project initiated to respond to the devastation in Rwanda's agriculture sector after the events of 1994. The objective of PEARL is to strengthen Rwanda's agricultural institutions and work with them to identify and execute rural income generating activities. PEARL was awarded a $3.7M USAID cooperative agreement for three years from October 2000 to September 2003. Later, PEARL was extended for a second three year phase from October 2004 through December 2006 for $3.2M. PEARL is executed by Michigan State and Texas A&M Universities.

Problem: The USAID/Rwanda budget for agriculture has recently been cut in half. Some of those cuts have filtered down to affect the PEARL Project (Partnership to Enhance Agriculture in Rwanda through Linkages). Unless this core funding is restored ($400,000 minimum, but $600,000 would be ideal), PEARL will need to terminate by October-November 2005.

Closing out PEARL core activities prematurely will have a perilous impact on the 16,000 coffee farmers that have for the first time ever begun to produce high quality specialty coffee for export markets. Incomes of these farmers have more than doubled since their partnership with PEARL. These farmers have developed cooperatives with PEARL assistance and many are still in their infancy and are extremely fragile as they develop independent commercial relationships with international buyers in an attempt to break the predatory pricing stranglehold of the traditional coffee exporters entrenched in the region.

Danger of losing leveraged funds. Further complicating the situation is that PEARL core funding for FY2006 has been so highly leveraged with contributions by 25 private sector partners (coffee importers and roasters such as Sustainable Harvest, Green Mountain Coffee, Allegro, Intelligentsia Coffee and Tea, Counter Culture, Bullrun Roasters, European Roasterie, Paramount, Deidrich, Community Coffe, Groundwork Coffee, Stumptown Roasters, Thanksgiving Coffee, Interamerican Coffee, and Volcafe Specialty), as well as by other funding sources such as Ecologic Finance, the Africa Development Foundation, FreePlay Radio, Rotary Club Minnesota, Last Mile, Saddleback Churches, Heifer Project, the Nagele Foundation, CPI and the Coffee Quality Institute. Core funding cuts have jeopardized this important stream of funding to individual cooperatives and the newly formed Specialty Coffee Association in Rwanda.

Solution: MSU and Texas A&M are working closely with the Rwanda mission and industry partners to piece together emergency transitional funding to continue this capacity-building program until October 2006 when new funding support for continued transformation of Rwanda's coffee sector are expected to become available. Specific actions to be taken include:

• US Coffee Companies are collaborating in the campaign to raise the needed resources and will contact representatives on Capitol Hill for their support
• Enlist the support of key USAID offices/initiatives (Africa Bureau, EGAT, IEHA, TRADE).
• Resubmit a proposal for funding through the Global Development Alliance (GDA). Industry support has become overwhelming in recent months, making the proposal increasingly attractive from a GDA point of view.
• Solicit funding contributions from foundations and other agencies with commitments to reducing poverty in Africa.
• Engage government partners in Rwanda (Ministries of Education, Agriculture, Commerce and Trade).
• Invite President Kagame to Michigan State University during his upcoming trip to the US. Explore with Kagame the possibility of raising the needed resources from within Rwanda and in the U.S.

What makes the PEARL project so important for Rwanda? PEARL is a high-impact, highly leveraged program that has transformed the coffee sector in Rwanda, launching the first specialty coffee that Rwanda has ever produced or sold. PEARL works at every stage of the value chain and incorporates industry experts to improve coffee quality at every stage. PEARL has not only spearheaded the specialty coffee sector but has also developed the commercial chili pepper export sector in Rwanda and created the first fully produced, packaged, and exported food product 'shelf ready' for supermarket chains specializing in Ethnic Food.

The success of PEARL in launching and sustaining the transformation of Rwanda's coffee industry has been remarkable. The media have picked up on this success and USAID has broadly benefited from all the positive press. Most exciting of all is that just three years ago Rwanda produced no specialty coffee. Today, via the PEARL projects 23 community washing stations, the country is exporting US$3.0 million in specialty coffee and the industry is growing at a phenomenal rate. Since 2001/02 over 20,000 smallholder farmers have more than doubled their income. Buyers can't get enough Rwandan coffee. The projections for next year a much higher, as more and more communities participate. The country's goal now is 100 washing stations by 2010. At the current rate of growth and with the right support, this will be achieved well ahead of schedule if PEARL can find a way to continue.

Sustainability of these cooperatives is the big question that we now need to address, particularly in the face of predatory pricing from the regional coffee giants. These cooperatives represent a cultural and social change in Rwanda and are therefore fragile. In order to build their capacity to manage and lead, PEARL has just begun to undertake specific strategies. These include the strengthening of each cooperative through an already funded IT initiative, the development of a coffee federation to effectively support the business and training needs of each cooperative, and the promotion and facilitation of sustainable relationships with high profile private sector partners in the specialty coffee industry to insure the creation of long term contracts.

CNN, BBC, PBS Wide Angle and ABC World News Tonight with Peter Jennings have all aired film specials on the PEARL Project and its successes. In the printed news, PEARL has been featured in articles in TIME magazine (just last month), the New York Times, USAToday, the Miami Herald, Detroit Free Press, Chronicle of Higher Education and dozens of others.