A laborer holds a basket of freshly picked coffee beans.
Courtesy United Nations (.J.P. Laffont)

Nowhere has the decline in agricultural production been more dramatic than in the coffee sector. Formerly Angola's leading export, by 1985 coffee exports had dropped to 8 percent of their 1973 level (see table 10, Appendix A). Under colonial rule, about 2,500 large commercial farms and 250,000 peasants were involved in growing coffee. During the 1975-76 fighting, the owners, managers, and skilled technicians, as well as most of the migrant work force, abandoned the coffee estates, which were then nationalized. Suffering from a lack of skilled management and shortages of available labor in the rural areas, these coffee farms have continually posted losses. By 1985 the thirty-four state coffee companies produced only 8,890 tons of coffee and depended on government subsidies to stay in business. The government marketed only 4,700 tons from peasant producers in that year.

In 1983 the government adopted an emergency program to revive the coffee industry. Local coffee companies, rather than the National Coffee Company (Emprêsa Nacional de Café--Encafe), were given the responsibility to run the state coffee farms, and, to encourage greater efficiency, the area under cultivation was reduced to less than one-fifth of the area abandoned by the large commercial coffee growers at independence. Aid for these efforts has been obtained from the French Central Board for Economic Cooperation (Caisse Centrale de Coopération Economique--CCCE) and two UN organizations, the WFP and the Food and Agriculture Organization (FAO). The WFP was furnished with US$14.3 million on a five-year (1983-87) plan to pay coffee workers in food rather than in local currency to discourage worker absenteeism, one of the industry's most serious problems. In addition, the government, as part of its program of economic liberalization, was in the process of turning over the marketing of coffee to local, rather than national, organizations.

Despite these efforts, however, by 1985 the state coffee farms had only about 50 percent of the required work force because of the general drain of people from the rural areas and the unattractive wages that were paid in nearly worthless kwanzas. Moreover, the industry was still plagued by the UNITA insurgency, whose attacks had inflicted over US$4 million worth of damage on coffee plantations by 1985. Other problems encountered on the coffee plantations mirrored the general deterioration of the economic infrastructure. High charges for transportation of coffee and machinery and lack of facilities for hulling the coffee slowed and made more expensive the entire production process. Furthermore, some plantation managers complained that their workers were not productive, not only because of absenteeism but also because of their advanced age.

The decline in coffee exports in the mid-1980s resulted largely from the depletion of stocks that had 3b1 d earlier cushioned exports as production declined. Exports to members of the International Coffee Organization (ICO) have remained fairly stable since 1983, but exports to non-ICO members, of which East Germany has been by far the most important market in the late 1980s, have declined. The fall in sales to the non-ICO market has eroded coffee earnings because these sales have traditionally been at substantially higher prices than those to ICO members. Exacerbating the decline in production and exports has been the depressed world market for coffee. From February 1986 to August 1987, ICO indicator prices dropped by more than 20 percent.

Data as of February 1989