Developing Fair Trade Lending in Colombia

The following is a weekly report from Hugo Villela, Market Development Executive – Central America.

Hello all. I thought you would like to hear how my recent trip to Colombia went. My trip had several objectives. First, I wanted to meet with a company called Fruandes to see how things are progressing.  Secondly, I need to meet with representatives from the Colombian Central bank to get clarification as to whether the type of financing that Shared Interest offers is permissible under Colombian law. Lastly I was invited to participate in Sustainable Harvest’s ‘Let’s Talk Coffee 2008” conference.

Before I tell you about official business, I would like to tell you a bit about Bogota. It is situated in the Andes at 2600 meters above sea level and has a population of roughly 9 million. Before my meeting with the Central Bank, I walked through a park where emeralds are openly traded. While perfectly legal, there was definitely a feel that anything could happen at the drop of a hat. Not far from the emerald traders there was a photos shoot with beautiful Colombian models. Bogota is an amazing city filled with many extremes.

My meeting with Fruandes Managing Director, Geovanni Porras, was quite successful. I was able to see their processing facilities and manufacturing processes. Incidentally, Fruandes was founded with the help of an NGO that works with internally displaced people and ‘Level Ground’, a recognized Fair Trade Organization (FTO), and a direct importer, wholesaler, and roaster of coffees, naturally dried tropical fruit and cane sugar. Geovanni’s main concern in working with Shared Interest was with the legality of the structure of advanced payments as they relate to Colombian banking laws.

These issues were addressed the next day when Geovanni and I met with representatives from the Central Bank. Because there are not many micro or alternative lending companies operating in Colombia, the conversation started out at a very basic level. The discussion quickly progressed and we were able to determine that we are not breaking any banking laws by providing lending (pre-financing).

Before I traveled to Armenia (Colombia) for the ‘Let’s Talk Coffee’ forum I was fortunate to have had the opportunity to meet separately with Proexport (Exportation and Foreign investment promotion institution) and the Bogota Chamber of Commerce. Both organizations were very keen on fair trade and were very interested in the work that we (SI) do. These two orgainizations will be great contacts who will help spread the word about Shred Interest.

For the past six years, Sustainable Harvest has hosted Let’s Talk Coffee to bring our supply chain partners together to discuss sustainability in the supply chain, communicate stakeholder needs, and calibrate quality expectations. Let’s Talk Coffee assembles farmers, cooperative leaders, roasters, industry visionaries, market analysts, and business experts, providing a forum for 250 participants from thirteen countries to receive industry-specific training, listen to expert presentations designed to help improve supply chain quality, and share best practices among peers (from the Sustainable Harvest website).

The conference was excellent. It was a fantastic opportunity to meet with current clients and network with potential clients. All in all, I met with producers from Mexico, Peru, Colombia, Nicaragua, Costa Rica, Ecuador and even one from Tanzania.

All in all, this was a fantastic trip and I feel as though we have accomplished all of our objectives. We were able to determine that we can legally operate in Colombia as well as raise our profile in the region.

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Mexican coffee farmer at work in the fields


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2 thoughts on “Developing Fair Trade Lending in Colombia

  1. Hello,

    In your travels throughout Bogota, can you tell me if you came across and Fair Trade companies that produce textiles or anything for home decor?

    Thank you.

  2. Hi Angelica,

    Sorry for the delay in responding. I recently heard from Hugo and asked him about fair trade textile companies in Colombia and he said he had not seen or met with any. Sorry for the delay in responding.

    Patrick

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