Mr. Conall O'Caoimh:

I thank the Vice Chairman for inviting me and greatly appreciate the opportunity to address the joint committee. We are delighted to celebrate Africa Week and note that the committee is hosting this meeting as part of the events of that week. The chairperson of Value Added in Africa and some of my colleagues are in the Visitors Gallery. Ours is an Irish-initiated fair trade organisation and a registered charity. We started in 2008 just as the economy started to plummet. Therefore, we came along at a challenging time in introducing new products. As a result of the recession and because of the size of the market here, we started to look to Britain where Value Added in Africa is registered as a not-for-profit organisation to help African producers to find larger markets.

We are funded by our own fund-raising events, including by a number of families who give us very generous support for which we are grateful, by a small bit of commission we get on any sale we facilitate and by Irish Aid, Trócaire, Concern and Electric Aid.

The reason we set up the organisation connects very strongly with Ireland and with its experience of beef exports. The members will know very well the story of exporting Irish beef on the hoof, the cattle walking onto the ship bound for Britain and somebody there making the money on that trade and selling the product back to us. That moment of realisation or light-bulb moment is where many of the African countries are at. An example of that in the case of coffee is shown in the presentation. Kenya earns three times more when it sells its coffee roasted, packaged in an attractive bag and meeting all the food safety standards - we are delighted that the Kenyan ambassador is here today - than when it sells the raw beans to Nestlé or whichever other company wishes to buy them. That price difference is what will be a significant driver of economic development and poverty reduction.

African producers are beginning to move up the value chain, it has had a traditional sector of primary commodity production and now an emerging sector, which is still small and fragile, is beginning to process and achieve world standards. Those in that sector are also supplying to the local market. We come into that chain in the middle as a link, linking them to importers and distribution companies who will bring that product through to the market in order that the value goes back to both the primary producers and the people in the factories who make those products. Our mission is to create a channel for African goods to come into the market. There is a lack of information among business people here. There is a bias against African products coming in here; people are afraid of this trade. There is a network of institutional practices that make it very difficult for African producers, particularly small ones, to sell good products into the market. That is why we are there as a link, a facilitator or a matchmaker which brings the two sides together.

This week we want to draw attention to the One World, One Future policy, and I thank the Vice Chairman for his comments on that policy at the outset. We strongly welcome the policy document. It opens with the very first sentence referring to moving beyond aid and we need to do that. The question then is - what will this thing after aid be like? The Africa strategy comments on that being an equal and mature partnership. That will involve a range of actors, including NGOs but not only NGOs. There will be quite a range of other actors and the private sector will have role in that. The commercialisation of people's produce will also have a very important role in that.

Connecting with Ireland's other foreign affairs interests is an issue that comes across very strongly in the paper. We can well understand that in looking to the taxpayer to support an aid programme, it is very important to appeal not only to people's moral sense of obligation but also to the public interest where there can be synergies, to use the term that is mentioned in the paper. The paper leaves a number of questions wide open around what happens next and that is the area in which we are particularly interested. There is no mention in the paper of value addition. It strongly refers to allowing people to move to trade and build trade relationships but there is no mention of processing, moving up the value chain and producers capturing more of the value. There is none of that language in the report and that is quite a concern for us. When it comes to the next stage of fleshing out what is to happen, we would like significant attention to be given to fleshing out that. We have the examples of Irish beef or the coffee example which show that poverty reduction will not be achieved by just increasing trade.

Some later slides in the presentation are graphs setting out the commodities exported from African countries which show that the prices that one gets for raw materials have been steadily declining since the time of the industrial revolution. Primary producers will produce more to get a better income but the more they produce the more it pushes the price down. That is what we refer to as the trade trap.