Indonesian Coffee in The Global Value Chain: The Comparison of Global Partnership Sustainability Standards Implementation

Achmad Fadillah,Dikky Indrawan,Noer Azam Achsani

doi:10.17358/jma.16.2.191

Achmad Fadillah, Dikky Indrawan + Show 1 more

Open Access

https://doi.org/10.17358/jma.16.2.191

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Abstract

Global partnerships based on sustainability standards compiled by international NGOs are needed to achieve social, economic and environmentally sustainable development, as well as to deal with global uncertainty in trade and business of agricultural commodities, including coffee in Indonesia. This paper aims to compare the implementation of global partnership standards in coffee between Indonesia and other producer countries. The Study focused on sustainable standard-compliant in coffee such as 4C and Organic certification standards. Trade and sustainability map tools were described. The findings demonstrate that there were only 8 percent and 9 percent of the Indonesian coffee area certified by 4C and Organic, respectively. Indonesia placed at number fourth of 4C implementation in the worldwide after Brazil, Colombia, and Viet Nam. Indonesia is also placed at number fourth of Organic implementation in the worldwide after Mexico, Ethiopia, and Peru. To compete in the potential market, Indonesia’s commitment to implement sustainable standard-compliant in coffee is needed. Therefore, Indonesia has to increase the coverage of sustainability standards certified area to meet the global market demand. The government also should implement the right policies and programs to enhance the sustainability compliance of national coffee stakeholders.Keywords: coffee, global trade partnership, sustainability standards, global value chain

Highlights

In the trade and business of agricultural commodities, global partnerships based on standards compiled by international NGOs is are needed to achieve social, economic and environmental sustainability
Based on Lernoud et al (2018), Indonesia placed at number fourth in the worldwide after Brazil, Colombia, and Viet Nam
Based on the global trade coffee performance showed that Brazil, Columbia, Vietn Nam, Ethiopia, and Indonesia are the top five global coffee exporters in 2018 with value exported of USD 4.37 billion, USD 3.26 billion, USD 2.34 billion, USD 8.57 billion, and USD 8.18 billion, respectively (Table 1)

Summary

Introduction

In the trade and business of agricultural commodities, global partnerships based on standards compiled by international NGOs is are needed to achieve social, economic and environmental sustainability. Fair Trade sustainability standards implementation rapidly increase on the global food markets (Raynolds, 2012). The right business partnership strategy is needed to deal with global uncertainty in trade, industry, and business of agricultural commodities. The 17th Sustainable Development Goal (SDG) focuses on strengthening partnerships for sustainable development. This goal means the implementation and revitalization of the global partnership to supports the fulfillment of the sixteen other goals. Intersectoral partnership in coffee commodity can improve a sustainability of coffee global chain (Bitzer et al 2008). There was development and co-evolution of commodity value chain and sustainability standards in the global market (Manning et al 2011)

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