East German coffee crisis

The East German coffee crisis refers to shortages of coffee in the late 1970s in East Germany caused by a poor harvest and unstable commodity prices, severely limiting the government's ability to buy coffee on the world markets. As a consequence, the East German government increased its engagement in Africa and Asia, exporting weapons and equipment to coffee-producing nations.[1]

East German coffee mix, consisting of 51% coffee, produced due to shortages

Situation

In 1977, East Germany experienced difficulties meeting domestic demand for coffee, a commodity that had to be purchased using "Westgeld", or freely convertible Western currencies, in short supply in Eastern Bloc countries. The coffee crisis indirectly led to changes in the world market for coffee. The coffee crisis led to a reorientation of East German foreign policy[2] as well as considerable belt-tightening.[3] In particular, the East German government engaged in barter with Third World countries, exporting weapons and trucks in exchange for coffee and energy.[4]

Background

In the Soviet occupation zone, much like the rest of Europe after World War II, coffee was a scarce good. The first coffee imported into East Germany came from the Soviet Union. When these imports stopped in 1954, this led to the first mass shortages and intensified efforts to acquire foreign currency with which to purchase coffee. Beginning in 1957, roasted coffee was produced under the brand name Röstfein. Beginning in the 1960s, East Germany was able to reliably provide basic necessities, but luxury and exotic products remained scarce.[5] This led to increased demand for the available luxury goods, such as confections, tobacco, alcoholic beverages, and coffee (3.6 kilograms (7.9 lb) annually per capita) in the 1970s. By the 1970s, coffee was one of the most important items in an East German household budget, although gifts from friends and relatives in the West met about 20 percent of the country's coffee needs.[6] East German citizens spent an average of 3.3 billion East German marks for coffee per year, an amount comparable to expenditures on furniture and twice the amount spent on shoes.[7]

Coffee crisis of 1977

The coffee crisis began in 1976. The price of coffee rose dramatically after a failed harvest in Brazil, forcing the East German government to spend approximately 700 million West German marks on coffee (approximately US$300 million, equivalent to $1.27 billion today), nearly five times the expected DM 150 million per year.[8] The Socialist Unity Party (SED) leadership restricted the importation of food and luxury goods, while trying to gather sufficient foreign currency reserves to import petroleum.[9] This occurred against the backdrop of the 1970s energy crisis, as the effects of the 1973 oil shock only began to affect East Germany in the mid-1970s.[10]

The suggestion to cease coffee production, put forward by Alexander Schalck-Golodkowski, was able to be avoided after Central Committee member Werner Lamberz encouraged barter trades and armament sales[11] with Third World countries, such as Ethiopia and Mozambique. The cheapest variety of coffee, "Kosta", was discontinued and only more expensive varieties were available.[12] Other alternatives were made available, such as "Kaffee-Mix", a 50 percent mixture of genuine and ersatz coffee, and rationing was not required. The Kaffee-Mix was pejoratively referred to as "Erichs Krönung", a reference to Erich Honecker, leader of East Germany, and the West German Jacobs Krönung coffee brand. The East German government assumed that much of the population would acquire coffee from Westpakete sent by West German relatives. This increased the demand for the typical return gift, a Dresdner Stollen, which also caused difficulties in the East German economy, because many of the ingredients, such as almonds, raisins, and succade, were also only available as imported goods. Alexander Schalck-Golodkowski's suggestion of a ban on gifting Stollen was unsuccessful.[13]

The citizens of East Germany[14] overwhelmingly rejected the Kaffee-Mix and saw the coffee shortage as an attack on a major consumer need that was a large part of everyday life. The coffee mix also damaged some coffee machines, as the mixture contained substitute ingredients such as pea flour, which contains proteins that swell under heat and pressure, clogging the filters.[15] This led to numerous complaints and outraged reactions and protests.[16] Even though the price of coffee on the international markets retreated and normalized in 1978,[17] the problems faced by the East German government acquiring foreign currency continued into the 1980s, prolonging shortages that progressively damaged the image of the country's political leadership. It is estimated that 20–25 percent of the entire East German coffee consumption from 1975 to 1977 arrived from the West in care packages.[13] Coffee attained a value as a symbol of inner-German unity, far above its role as a mere consumer good or commodity.[18]

Effects on West Germany

In West Germany, the coffee price increases in 1977 did not lead to any shortages, but did lead to the adoption of cheaper varieties of coffee in the lower price segment.[13] Coffee brands such as Tchibo and later Eduscho began to make forays into cross-selling, by offering coffee as well as non-food items. These changes can also be attributed to the effects of the coffee crisis on West Germany.[13]

Influence on coffee production in Vietnam
Main article: Coffee production in Vietnam

The relationship between East Germany and Vietnam was exceptionally close.[19] Coffee production began in Vietnam in 1926 during French colonial rule.[20] Beginning in 1975, largely parallel with the coffee crisis in East Germany, the production of Robusta coffee began in Vietnam. Robusta plants grow faster, contain more caffeine, suit the climate of the Vietnamese Central Highlands, and lend themselves better to mechanized harvesting. However, Robusta coffee is cheaper, albeit lower quality, than the gold standard Arabica.

In 1980 and 1986, two treaties were signed between East Germany and Vietnam, whereby East Germany provided the necessary equipment and machinery for production, increased the area of coffee plantation from 600 hectares (1,500 acres) to 8,600 hectares (21,000 acres), and trained the local population in cultivation techniques.[20] In particular, East Germany provided trucks, machinery, and irrigation systems for the newly founded Kombinat Viet-Duc, as well as spending approximately US$20 million on a hydropower plant.[20] East Germany also built housing, hospitals, and shops for the 10,000 people who were relocated to the area for coffee production. Against this investment, East Germany was scheduled to receive half of the coffee harvest for the next 20 years.[20] However, coffee takes eight years from planting until the first usable harvest, which occurred in 1990.[21]

Vietnam was quickly able to establish themselves after 1990 as the second-largest coffee producer in the world after Brazil, driving much of the traditional coffee production in Africa out of the market. In particular, this was helped with the re-establishment of trade relations between the U.S. and Vietnam. This overproduction led to a crash in worldwide coffee prices in 2001. In 2016, Germany still was the largest export destination for Vietnamese coffee.[22]

gollark: Well, what *is* good?
gollark: God is just a monoid in the category of endofunctors. Also dead.
gollark: I knew someone who liked Jordan Peterson. I do not like that person. Therefore, logically, they must be bad.
gollark: Press the plus button.
gollark: It is not very mobile-optimized or robust or nice-looking, but too bad, suffer.

See also
  • Economy of the German Democratic Republic

References
  1. "Kaffee gegen Waffen: DDR und Äthiopien – eine schwierige Beziehung" [Coffee for Weapons: East Germany and Ethiopia - A Difficult Relationship]. Mitteldeutscher Rundfunk (in German). 6 August 2014. Retrieved 5 June 2019.
  2. Schmidt, Heike; Wirz, Albert (1998). Afrika und das Andere: Alterität und Innovation : Jahrestagung der VAD vom 3.–6.10.1996 in Berlin (Schriften der Vereinigung von Afrikanisten in Deutschland) (in German). Berlin-Hamburg-Münster: LIT Verlag. ISBN 3-82583395-X.
  3. Döring, Hans-Joachim (2007). Development policies and solidarity in the GDR, presented using examples of state cooperation with Mozambique and Ethiopia and the development-related education of independent groups. TU Berlin (Thesis).
  4. Döring, Hans-Joachim (1999). "Es geht um unsere Existenz": Die Politik der DDR gegenüber der Dritten Welt am Beispiel von Mosambik und Äthiopien (in German). p. 115ff. ISBN 3-86153-185-2.
  5. Wünderich, Volker (2003). "Die "Kaffeekrise" von 1977". Historische Anthropologie. 11 (2): 240–262. doi:10.7788/ha.2003.11.2.240.
  6. Wolle, Stefan (1999). Die heile Welt der Diktatur. Munich: Econ & List. p. 328. ISBN 978-3861535546.
  7. Kaminsky, Annette (1999). Illustrierte Konsumgeschichte der DDR. ISBN 3-931426-31-9.
  8. "DDR: Die Bürger werden aufsässig". Der Spiegel (43/1977). 17 October 1977. p. 46, 53. Retrieved 5 June 2019.
  9. Steiner, André (2006). "Bundesrepublik und DDR in der Doppelkrise europäischer Industriegesellschaften Zum sozialökonomischen Wandel in den 1970er Jahren". Zeithistorische Forschungen [Studies in Contemporary History]. 3. ISSN 1612-6041. Retrieved 19 October 2019.
  10. Karlsch, Rainer; Stokes, Raymond G. (2003). Faktor Öl: Die Mineralölwirtschaft in Deutschland 1859-1974. ISBN 978-3406502767.
  11. Mohl, Arian (22 May 2007). "Blaue gegen braune Bohnen: Die Stadt Luckenwalde will den DDR-Chefideologen Werner Lamberz mit einer Erinnerungsstelle würdigen". Märkische Allgemeine.
  12. Mitteilung des Ministeriums für Handel und Versorgung vom September 1977, Berlin (ADN).
  13. Kaffee in beiden deutschen Nachkriegsstaaten: Konsum, Diskurs, Deutung und Beziehungen. Dissertation by Monika Sigmund, scientific collaborator since 2003 at the Forschungsstelle für Zeitgeschichte.
  14. Hans-Joachim Döring 1999, a.a.O, p. 121.
  15. "Kaffee in der DDR". die Kaffeetante. n.d. Archived from the original on 24 June 2010. Retrieved 29 June 2017.
  16. Felix Mühlberg: Bürger, Bitten und Behörden. Geschichte der Eingabe in der DDR. (= Texte 11 der Rosa-Luxemburg-Stiftung) 2004, ISBN 3-320-02947-9.
  17. "Kosta, Rondo, Kaffeemix – Honeckers Kaffeekrise". Mitteldeutscher Rundfunk. 16 January 2007. Archived from the original on 3 February 2007. Retrieved 5 June 2019.
  18. "Kaffeeverband" (PDF). Archived from the original (PDF) on 21 August 2006. Retrieved 30 June 2017. Reader des deutschen Kaffeeverbandes, Stand 2004, abgerufen August 2008.
  19. "IHK-Länderschwerpunkt Vietnam". Cologne Chamber of Industry and Commerce. Archived from the original on 10 March 2004 – via ihk-koeln.de.
  20. Schäfer, Bernd (2015). "Socialist Modernization in Vietnam: The East German Approach, 1976-1989". In Slobodian, Quinn (ed.). Comrades of Color: East Germany in the Cold War World. p. 107-109. ISBN 978-1-78238-705-3.
  21. "Vietnam und die DDR schließen "Kaffeeabkommen"" [Vietnam and East Germany Sign "Coffee Treaty"]. Mitteldeutscher Rundfunk. Archived from the original on 14 June 2016. Retrieved 14 June 2016 – via daklakcoffee.de.
  22. Phuong, Ha (16 August 2016). "Vietnamese coffee wins Germans' hearts". vnexpress.net. Retrieved 30 June 2017.
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.