Beyond Fair Trade

by Mark Pendergrast

  I think there are some tentative answers, based on the research and interviews I have conducted for this book. The particular model provided by Doi Chaang Coffee, in which half of the Canadian company was essentially gifted to a consortium of Akha farmers, is not necessarily a model for others to follow, but it does provide an example for those who want to break free of the traditional, prevailing capitalistic model, in which cheap commodities have been extracted from poor developing countries, then processed and sold in developed nations—where most of the profits remain.

  As the anthropologist Eric Wolf observed in his classic 1982 work, Europe and the People Without History, “The world of humankind constitutes… a totality of interconnected processes.” The story of opium and coffee in Doi Chang and elsewhere provides one fascinating thread, stitching together the disciplines of history, anthropology, sociology, psychology, medicine, and business, and offering a way to follow the interactions that have formed a global economy. While this book has concentrated on coffee and opium, similar stories could be told for other products. The European countries extracted furs, silver, gold, diamonds, slaves, spices, sugar, tea, coffee, cocoa, tobacco, opium, rubber, palm oil, and petroleum from Asia, Africa, and the Americas. As North America, taken over by white Europeans, developed industrially, it too joined the conquest.

  As the world has become more of a global village, a place in which a coffee harvester high on a remote mountainside can stop to talk to someone hundreds or thousands of miles away on his or her cell phone, the inequities built into the world’s economy have become more glaring. Fortunately, this has been accompanied by a heightened awareness about how products make their way to Western marketplaces. Increasingly, people are showing concern about and interest in not only the quality of the products they purchase, but who made them and under what conditions, and how they were paid. That is the basis of certifications such as Fair Trade. Yet Fair Trade establishes only a kind of minimum wage, arguably not a particularly fair one—it’s better than the coffee C-market, but still inadequate. The “Beyond Fair Trade” model established by Doi Chaang Coffee really does make a substantial difference, and I hope that in the coming decades, true partnerships between producers at origin and retailers in developed countries will become commonplace.

  The other model that Wicha’s vision helped establish was roasting at origin, so that more of the profits remain with the villagers. As John Darch Junior emphasized, coffee becomes a substantially value-added product after it is roasted. Traditionally, green coffee beans have been exported, with a few exceptions, such as Café Britt, which roasts Costa Rican beans in Costa Rica, Peruvian beans in Peru, and Colombian beans in Colombia. Now, with coffee consumption increasing in origin countries such as Brazil, more roasters should be able to keep more of the profits in-country.

  After coffee is roasted, it stales quickly when exposed to oxygen, and for many years, that meant pre-staling packaged coffee, since freshly roasted beans produce carbon dioxide, and the “de-gassing” process would burst airtight containers. But one-way valve bags can now keep roasted beans fresher for months, which makes it possible to roast at origin and ship throughout the country and even across borders, as Café Britt has demonstrated.

  In the coming years, we are likely to see a slow shift in the inequity built into our capitalist system, as “developing” countries attain greater wealth and the global playing field becomes “flatter,” as economist Thomas Friedman puts it. Thailand has, in fact, come far along that path, as have China and India, for example. There are still glaring contrasts between extreme wealth and poverty in those countries (as in North America, for that matter), but I hope that the model of compassionate capitalism that John Darch Senior and Wicha Promyong attempted to model will inspire people in other countries around the world. Coffee is a perfect product for that model, but as Darch told me, “I am not a coffee person. We focus on the highest quality, but it could have been any commodity that I tried to help sell. I am passionate about people, especially underdogs who, through no fault of their own other than the accident of birth, seem to have the world against them. This just happened to be in Thailand, and it happened to be coffee.”

  In my conversations with him, Darch emphasized that he was not acting out of guilt when he created the new coffee company. He had no regrets in having promoted his various mining ventures, though over the years he had become more concerned about the environmental impact of such extractive industries, and he was haunted by the deaths in the Rovic diamond mine collapse. “My move to coffee wasn’t waking up and thinking I hate mining and want to pay for my sins. Our society is built on the use of natural resources. We need mines, unless we want to go back to living in caves. Coffee is renewable and sustainable, but it must be processed and transported, all of which requires oil, gas, electricity, and trucks. The metal for those trucks had to be mined.” Darch noted that everything we use has been “either grown, mined, or pumped out of the ground.”

  I pointed out the irony that Darch made a good deal of money from selling his Thai potash concession and is still promoting other potash ventures, and that he used part of that money to establish an organic coffee company. Potash is one of the three primary ingredients in chemical fertilizer. Wasn’t that a contradiction? Darch demurred. “Potash is essential to improve the strength of plants, to make them grow better, resist diseases, and feed more people. If we didn’t mine that potassium, billions of people would be worse off.” It was great that the Akha could recycle their pulp as organic fertilizer, but Darch insisted that “in certain areas of the world,” organic was not an option.

  In one of my interviews with Wicha, I asked him whether he was uncomfortable with Darch’s profits from potash. “No,” he said, “John is a good man.” Wicha disliked all chemical fertilizers and thought that the “green revolution” had done more harm than good, and if Darch ever wanted to use potash in Doi Chang, he would refuse. But he had no problem with accepting Darch’s help. “We are family,” he insisted.

  Darch acknowledged that, in the past, the mining industry had often been irresponsible, focusing on profits more than people and the environment. “We need watchdogs but not fanatics. There is a fine balance. Some activists just want to stop anything.”

  I asked whether he expected to recoup his substantial investment in Doi Chaang Coffee. He hoped he would. He was irritated when people regarded it as “a charity under the guise of a business,” and he repeatedly compared the venture to a junior mining company in the developmental stage, where early investments were not expected to yield a profit, but in the long term they might succeed. Yet he admitted, “Most of my former mining friends were skeptical, asking, Why? Where is the profit?” Darch’s old mentor, David Giddings, is one of the cynics. “John really cares about the people up there in the village,” Giddings said. “This is probably the first time in his life he’s done something so generous and misguided. I don’t think he’ll ever get his money back. It’s not impossible, but I don’t think it will grow sufficiently big to float, even on the Vancouver stock exchange.”

  Darch has no plans to take the small Canadian coffee company public, but he is looking for a “strategic partner” to take the company to the next level. He cited the success of Kicking Horse, the British Columbia coffee company started in a garage that sold for millions. Indeed, he might try to entice Kicking Horse CEO Elana Rosenfeld into becoming a partner in Doi Chaang.

  I would not be surprised if Darch Senior did indeed get his money back. He is a powerfully persuasive salesman. “I have always had confidence in my ability to find a way, and that way would become apparent as everything unfolded,” Darch observed, looking back on his career. “I never began a project because I had dreams about how much money I could make, but because I believed in the projects and what they could be. I could visualize them up and running.”

  It’s become clear to me, as I have researched topics as varied as coffee, Coca-Cola, public health, psychology, astronomy, mirrors
, or renewable energy, that unusual individuals have made all the difference. There have always been driven, visionary leaders who have made change happen. True, they came along at a particular time in history and they happened to take an interest in a particular topic or venture. But without their ideas to drive others to action, little would have been accomplished.

  It occurred to me that John Darch Senior and Wicha Promyong, who grew up in such different circumstances, were surprisingly similar personalities. Both men refused to accept limitations. Both had enormous energy, required little sleep, and enjoyed multiple challenges. They were excited about new projects and possibilities but weren’t the best of managers. Each needed pragmatic people to keep them somewhat grounded in reality. While both men claimed not to care about money as their ultimate goal, they enjoyed establishing wealth-creating businesses. Ultimately, despite their rather large egos, both men acted selflessly to help others.

  “I see myself as a catalyst,” Darch said. “I enjoy telling the story of the Akha and seeing it evolve.” He acknowledged that he had a hard time “going in a straight line” and always had to have several enterprises going on simultaneously, just as Wicha did. “The sadness of his passing is hard to express,” he added. “He truly touched my heart. Wicha literally gave his life to others. But nothing would ever have been enough for him. He would always be looking for something new.”

  The same could certainly be said of Darch. “John has always been a very busy man,” observed Rupi Khanuja, Darch’s long-time financial officer. “I enjoyed working with him because I got to be challenged and learned a lot. I enjoyed the road shows, seeing how he presented a project. It takes a certain charisma to sell a hole in the ground, telling people what you are going to do. But he was always well-prepared and scrupulously honest.” Working with John Darch also had its challenges. “He doesn’t seem to sleep. I was working eighteen hours a day, and the worst thing I ever did was to give him a laptop and teach him to e-mail. I created a monster.”

  But once leaders such as Darch and Wicha establish companies (or other leaders I have written about who championed scientific advances, products, or programs), their legacy often lives on when they are gone. That certainly seems to be the case in the village of Doi Chang, where the Akha are carrying on with hardly a bump following Wicha’s untimely demise. “And if I pegged out tomorrow,” Darch said, “the wheels are turning enough so that Johnny (Darch Junior) and everyone else could carry on.”

  It would be a mistake to promote the myth of superior leaders who did everything alone, however. It is impossible to list everyone who made this joint international venture a success, but clearly Adel, Miga, Nuda, Lipi, and other Akha were essential in the village, while John Darch Junior, Anand Pawa, Tanya Jacoboni, and other staff in the Vancouver office and at Canterbury Coffee rose to the challenge in Canada. John Darch Senior points out that one key person is often overlooked—Kornkranok “Sandra” Bunmusik. “Sandra really was the catalyst, in her own soft way, in persuading Wicha and I to deal with one another smoothly. Many times, as we tried to move forward, she was the voice of reason.” She was always with Wicha when he traveled to represent the company, keeping him focused.

  As for possible cultural clashes within a business co-owned by Akha farmers and Canadian businessmen—yes, there have been some miscommunications, though the arrival of Anand Pawa, who grew up in Thailand and was educated in British Columbia, helped considerably. Goodwill, frequent visits, and respect for one another resolved most issues. Wicha never did understand why he couldn’t send Akha to Vancouver to set up roasting and distribution, though.

  I have already noted that the ripples from the establishment of Doi Chaang Coffee, in both Canada and Thailand, have been substantial and perhaps impossible to measure. One of the primary goals for both Wicha and Darch was, as Darch wrote, “to eliminate the coffee grower’s cycle of poverty by promoting education and health care, encouraging cultural identity and pride, and returning the majority of the revenues to the growers.” In large measure, those goals have been achieved, though the intervillage school that Wicha envisioned has yet to be built.

  Still, success has brought its own set of unanticipated problems. While the Akha may take pride in their cultural heritage, that heritage is being eroded with increased contact with other cultures. All village farmers, Akha as well as Lisu, do not share equally in the profits, and some original association members remain bitter over the 2010 split that occurred when Wicha and Adel decided to do their own processing and buy just-harvested coffee cherries directly from the farmers.

  Darch couldn’t forget the comment of a veteran business acquaintance, who cautioned him as he was beginning his roasting venture that new wealth in a poor community or family often leads to unpredictable results. “The people you are helping now are fully committed, but be careful of the second and third generation. Growing up with more money, education, and opportunities, they may not have the same level of dedication to the business. You may encounter levels of resentment because everything doesn’t come as easily as they expect.” In other words, human beings are likely to take for granted what they already have.

  It was clear to me from my time in Doi Chang village that along with the extraordinary success of the coffee venture came unanticipated problems, such as unplanned congestion and the cultural influences of television and computers. And a few succumbed to the temptations of drug abuse and gambling. But what were the alternatives? Would it be better to leave the hill tribes in poverty, marginalized in a society that stereotyped them as lazy, stupid, and inferior? It was clear that they could never go back to their traditional way of life, living freely and independently, hunting and growing subsistence crops on rotating fields. Nor could they go back to a reliance on opium poppies as their primary cash crop. The Akha and Lisu had to join the national and global economy. “We aren’t of a mind to say, ‘You continue in your grass huts as you were,’” said Darch. “Education, health, respect, and independence are key.”

  Without the help of the Canadian company, it is unlikely that the Thai operation would have grown the way it has. “If we had not come along, Doi Chaang would probably still be a small operation in northern Thailand. I don’t think they would have been so successful without the kick-start from Canada and the attendant international media exposure,” Darch says. “Thais love such attention from the foreign press, which gives status and credibility to domestic businesses.” Darch acknowledged, however, that the Thai business is already a success, whereas “our Canadian enterprise has a long way to go.”

  No one knows what the future will bring, either in politics or business. It seems likely that Doi Chaang Coffee will continue to thrive in Thailand. The brand is recognized as top-quality coffee produced and roasted domestically, and the franchise system is expanding into Korea and other Asian countries. There may be some new competition when the ASEAN free trade agreement commences at the end of 2015, allowing coffee grown in neighboring Asian countries to be imported without the current 90 percent tariff. Since the Doi Chaang name and brand image are already well established, however, it should continue to do well.

  Let the last word go to John Darch Senior. “It is our belief,” he wrote to me at one point, “that when the growers are able to significantly benefit from the sustainability and prosperity of their goods, they gain financial independence, security, dignity, and control of their own well-being. With basic survival no longer their priority, farmers are motivated to sustain production and quality control, and a strong, respectful partnership is formed.”

  ACKNOWLEDGMENTS

  ROB SANDERS OF Greystone Books was immediately enthusiastic about the Akha, their coffee, and the Vancouver firm that roasts the Thai beans. My thanks to him for taking on this project, and particularly to Lesley Cameron, the freelance editor engaged by Greystone to help whip my manuscript into shape.

  Many people in Thailand, Canada, and elsewhere made this book not only possible, but a pleasure to research a
nd write. That includes all of those included in the list of interviews below. I owe a large debt to Paul Lewis, retired missionary and anthropologist, for his ethnography and books on the Akha and for sharing his personal insights, and to retired missionary and agronomist Dick Mann for letting me read his unpublished memoirs. Both Lewis and Mann live at Pilgrim Place in Claremont, California. I am also grateful to Matthew McDaniel, founder of Akha Heritage Foundation, for letting me read his unpublished writings, even though I do not agree with some of his criticisms of missionaries (especially his unfair attack on Paul Lewis’s family planning activities). John McKinnon and Duangta Sriwuthiwong were generous in sharing their unpublished primary source documents about the village of Doi Chang in the 1980s. Ronald Renard wrote a great book about opium reduction in Thailand and provided me with invaluable contacts and suggestions.

  Anthropologists Deborah Tooker, Otome Hutheesing, and Cornelia Kammerer wrote extremely helpful books and articles as well as sharing further insights, and Otome welcomed me to her home in Chiang Rai, along with Mimi Saeju and Michael Vickery. Nong (Chayanin Sritisarn) was a great driver and translator during my research trip to Chiang Rai, during which I interviewed Bandid Jangnam and Lamar Robert, who graciously invited me to their homes, while Jacques Op de Laak took me up the mountain to revisit his coffee research station. Jitra Samsa welcomed me to the Payap University Archives, where her staff was helpful and accommodating.