USAID to close...

Can you guys handle it? A sharp reduction in programs that help farmers across the globe is imminent. The new administration in Washington has only been in office for a few weeks and has already suspended a program that has funded many beneficial activities.

Recall the facts. The United States Agency for International Development (USAID) is a federal agency that administers civilian foreign aid and development assistance on behalf of the United States government. With a budget of over $50 billion, USAID is one of the world's largest official aid agencies, accounting for more than half of all U.S. foreign assistance. USAID operates in over 100 countries, with a focus on Africa, Asia, Latin America, the Middle East, and Eastern Europe.

USAID's decentralized network of resident field missions is utilized to manage U.S. government programs in low-income countries for various purposes, including disaster relief, poverty alleviation, technical cooperation on global issues (such as the environment, U.S. bilateral interests, and socioeconomic development).

The program was established by John F. Kennedy in 1961, although U.S. humanitarian aid already had its genesis in the decisions of earlier presidents. For example, Herbert Hoover recommended aid to Belgium after the German invasion in 1915, as well as a plan to rebuild Europe, known as the 1945 “Marshall Plan.” This program funded many initiatives, and probably most of us indirectly benefited from its generosity.

It's clear that in the opinion of the new administration, USAID is “not to repair”, and the agency should be shut down.

However, at the end of January 2025, following a White House decision made personally by President Donald Trump and Elon Musk (the multi-billionaire head of the Department of Government Efficiency, DOGE), the program was “frozen.” Its fate seems a foregone conclusion, as the oligarch has publicly spouted theses (or conspiracy theories) that make it clear that in the opinion of the new administration, USAID is “not to repair”, and the agency should be shut down.

USAID packages are delivered by United States Coast Guard personnel.

Media outlets are expressing concern over the suspension of multibillion-dollar aid, reporting that dozens of senior USAID agency officials are on forced leave and thousands of program contractors around the world have been fired, translating into a freeze on funds paid to tens of thousands of humanitarian beneficiaries.

A portion of the annual budget was allocated to various organizations in coffee-producing countries, which then distributed it to programs designed to support coffee farmers.

We are concerned about the withholding of vital humanitarian aid from one of the world's wealthiest nations. This aid is intended for projects that support malnourished children and victims of natural disasters. However, we are also concerned about the impact of the suspension, and even termination, of U.S. aid to coffee production programs.

A portion of the annual budget was allocated to various organizations in coffee-producing countries, which then distributed it to programs designed to support coffee farmers. USAID's role was also to create safeguards for many valuable initiatives created by private companies and NGOs, whose fate has now become uncertain. 

The agency has explained that its assistance to the coffee sector is driven by the fact that the U.S. coffee industry accounts for nearly 1.7 million U.S. jobs and $225 billion in national gross domestic product (2023). However, the industry is almost entirely dependent on foreign coffee production by farmers in low- and middle-income countries, with 60 percent of the coffee supply coming from small farmers with less than five acres of land. USAID's assistance aims to enhance their livelihoods while ensuring a reliable supply of high-quality coffee. But let's remember that the farmers receiving this aid, after all, were not just trading coffee with the US, and their livelihoods are of the essence to us - links in the coffee chain around the world - mega-importance.

USAID's primary website has been non-functional for some time, but we were able to successfully reproduce the official 2023 report on USAID's correlation with the coffee market, which was created by the agency's staff. 

So, let’s cite examples of supporting.

1. 'USAID’s work in coffee spans many countries on three continents. Together with our partners, we are combating threats posed by the climate crisis that endanger global coffee crops while ensuring that coffee production protects forests and the climate. Through partnerships with the private sector, we are working to drive investment in sustainable production, and improve the environmental and economic benefits of conservation for local communities. We are also working to mitigate some of the root causes driving irregular migration, which among other factors has been clearly linked to shocks to the coffee industry in Central America. USAID is connecting coffee farmers to regional and international buyers and helping them improve quality and yields, so they can reliably access global markets and supply chains. Access is not enough to ensure a stable supply chain for companies or better incomes for farmers, which is why we take a holistic approach to help small-scale farmers and related enterprises boost productivity, improve quality, and meet international standards to compete in global markets. This is a win-win’.

2. Feed the FuturePartnership for Sustainable Supply Chains (PSSC) - is working resiliently in twelve countries in Latin America, Africa and Asia from 2020-2023. It has benefited many small producers, which was invaluable during the COVID-19 pandemic. Assistance included not only receiving consulting services, grants but also debt relief. 38% of those benefiting from the program were women farmers.

   

   USAID has supported countless initiatives related to the coffee market.

3. The Coffee Smallholder Livelihoods Facility, originally planned for 2019-2034, is an initiative introduced by Neumann Kaffee Gruppe, a leader in green coffee marketing.The objective of the NKG BLOOM initiative is to combat poverty in coffee communities, strengthen coffee farmers financially, and ensure a healthy future for coffee. At the core of NKG BLOOM is the Coffee Smallholder Livelihoods Facility, an innovative $25 million revolving facility, which was made possible through guarantees from USAID and commercial banks. USAID did not provide any financial participation, but its role as a indirect guarantor for loans to smallholder coffee farmers, amounting to up to $100 million, has been a crucial element in facilitating the program's objectives. The guarantee is valid for a period of 15 years, providing coverage for up to 100,000 families participating in the program.

4. Farmer-to-Farmer is a USAID program that provides technical assistance from U.S. volunteers to farmers, farmer groups, agribusinesses, and other agricultural sector institutions in developing and transitional countries. The program has had a particularly positive impact on farmers in Peru, Ecuador, Honduras, Guatemala, and Myanmar. The program has assisted with coffee production and processing, business strategy support, organizational development, coffee export support, carbon footprint reduction, and plant disease management, among other initiatives.

5. Farmfit Fund - a program planned until 2036 that offers low-cost loans to start, maintain and grow companies that sustainably work with small farmers in Africa, Asia and Latin America. A $100 million budget, and the program is half-funded by partners including the Dutch Ministry of Foreign Affairs, Raboank, Mondelez, Jacobs Douwe Egberts and Unilever. The USAID guarantee is as much as $250 million.

6. Sustainable Coffee Challenge - USAID sits on the Sustainable Coffee Challenge Advisory Board, which has the goal of making coffee the world's first sustainable agricultural product. The Advisory Board also includes private companies such as Starbucks, Keurig Dr Pepper, ofi, Neumann and McDonalds, as well as several non-profit organizations and industry associations.

   
   

We could go on for so long. After all, we still have programs such as: Cooperative Development Project, The Business Case for Collective Landscape Action, Green Invest Asia, Sustainable Coffee Challenge and a number of national programs. 

The guarantee is valid for a period of 15 years, providing coverage for up to 100,000 families participating in the program.

Let's put it this way, in Colombia it is for example the Land for Prosperity. That initiative has been implemented in the Tolima and Cauca regions, with plans to expand to Catatumbo. This initiative targets over 7,500 producers and includes the implementation of Escuelas de Campo (ECA) field schools. As part of this initiative, 310 women have been certified as Margure, a program that promotes water use and soil conservation in coffee cultivation. The initiative has also contributed to the formalization of land titles for 300 coffee-growing families. While we're on the subject of Colombia, after all, the Amazon Alive and Community Development and Licit Opportunities programs are also associated with USAID.

We won't list every program here, the 2023 USAID report has dozens of items, through the Democratic Republic of Congo, Vietnam, Mozambique, Maksik, Indonesia, Haiti. These programs are not only directly concerned with supporting coffee producers, but also with preventing climate change, countering negative social processes, deintegration of families, illegal labor immigration (to the US) and much more. Not judging, but some of the goals would seem to stand above party or political decisions.

Not judging, but some of the goals would seem to stand above party or political decisions.

USAID's decisions were made recently, and the organizations involved will need time to assess their impact. In other industries, there are early indications that for many projects implemented with support from the U.S. agency, failure to secure additional funding could lead to unexpected results and program closures. The question remains whether other world powers will be interested in addressing the lack of significant U.S. assistance, and whether coffee will be a priority in this challenge.