Get the App:
TechnoServe works with enterprising people in the developing world to build competitive farms, businesses and industries. Working in more than 40 countries across Africa, Latin America and Asia, TechnoServe assists thousands of businesses and improves the incomes of millions of people.
Chosen after a competitive global application process, these four PIMCO colleagues will serve as volunteer consultants in Nicaragua and Peru. From field visits to cost analysis, each PIMCO volunteer works alongside local farmers, helping create small businesses that are sustainable and transformative in their communities.
Position: Executive Vice President, Product Manager
Assignment: Develop an industry strategic plan for the coffee sector in order to design a large scale project to benefit El Salvador´s 20,000+ farmers to improve their short, medium, and long term income growth potential.
“The EEP represents a truly unique opportunity to help improve the quality of life for so many people in a significant and sustainable way, while also giving me invaluable experiences that will advance my professional and personal growth. I am incredibly excited for my project in Central America to begin!”
Position: Associate, FBG-Fund Statistics
Assignment: Develop a coffee sector industry strategic plan, which should include an analysis of the current situation, main problems affecting coffee sector growth, alternatives for positively impacting the sector and its farmers, and a cost-benefit analysis of each.
“I am looking forward to focusing my efforts on improving the lives of Central American coffee farmers. This is a once in a lifetime opportunity to face new challenges and promote sustainable change via economic empowerment.”
Position: Associate, Client Facing - Institutional Corporate
Assignment: Assess the viability and cost-effectiveness of implementing wet-milling in a region of Peru. Build operational and economic models for central wet mill processing for the coffee sector in Peru, that are sensitive to relevant assumptions.
“I am excited to represent PIMCO in helping to develop and grow sustainable businesses to improve communities in rural Peru. This transformative experience will help to shape my perspective as a global citizen.”
Position: Senior Associate, Client Facing - Germany/Austria
Assignment: Build a model based on how the economics of farmers would change with the presence of a central wet mill. Identify revenue and cost drivers for central wet mills, assess the viability of a central wet mill in a given location and propose a strategy for intervention.
“This is a unique opportunity to support communities in Peru through innovative and sustainable solutions that make family businesses grow. I look forward to collaborating with colleagues from PIMCO and TechnoServe as well as local farmers and entrepreneurs.”
Follow John, Scott, Jordan and Kai as they report from the field on their experiences and individual projects over the next two months.
On Saturday night, I landed safe and sound in Lima after a long trip from Munich via Madrid.
On the first day, Sunday, Jordan and I explored the city by walking along the cliff that marks the south-western border of the city towards the Pacific. The grey cloudy sky you see on the picture has been characteristic of the weather that is surprisingly humid and fresh at the same time, but fortunately it has not been rainy.
The old city center is further inland and we took one of the newly introduced public busses there. As a marketing campaign, these buses are free on Sunday and therefore packed, which made the bus ride an experience by itself.
Today was our first day in the TechnoServe (TNS) office here in Lima. We were introduced to several consultants and staff. TNS is currently working on three main projects in Lima. In the north, TNS is working with a Swiss company on developing industries that aim to benefit from the growing international trade in the region. In central Peru, from the office in Tingo Maria, TNS operates to support the cocoa farmers as well as coffee farmers; the project is funded by USAID. We will fly to Tingo Maria for the field work part of our project on Friday and stay there for three weeks. The main task there will be to collect data by interviewing coffee farmers, managers of “cooperativas” and coffee traders. While TNS will help us get in touch with the interviewees, our challenge will be to actually connect with them and extract the data points needed for our analysis. This is a rather remote area of Peru which will have an adventurous flavor. Lastly, TNS is also running a project in cooperation with an international mining company that supports local companies and businesses to profit and take part in the economic growth through mining in southern Peru.
In the picture: The Gran Hotel Bolivar at Plaza San Martin in the city center, decorated with the Peruvian flag.
I have just finished the first day of work at the TechnoServe (TNS) office in Lima. We worked closely with Enrique, the TNS country director in Peru, to formulate a timeline for our projects while in-country. We determined that to begin, we would focus on research of the wet mill model inputs and outputs as well as create an outline of our hypothesis for the models. The assignments we are working on in Peru are quite different from those at PIMCO as we are navigating a process that has more potential paths to a conclusion and fewer pre-determined best practices.
Lima has been a great introduction to Peruvian culture. Kai and I landed late on Saturday, but on Sunday morning we headed out to explore. We have both visited Lima previously but took the opportunity to wander along the coast in Miraflores and also to visit the historic city center where the Plaza de Armas and Plaza San Martin are located. Lima has embraced the traditional cuisines of the regions of Peru and we were able to sample some food and drink from Gaston Acurio, one of the most famous Peruvian chefs. We tried some scallop crudo along with some traditional drinks made out of the celebrated Peruvian liquor, pisco.
This week at the TNS office, we will meet with a specialist who will explain some details of the differentiation between specialty coffee and commodity coffee. This will provide some background as we begin formulating our economic models. We also intend to work on finalizing a paper that distills an extensive project completed by previous PIMCO volunteers into a shortened summary version. On Friday, we depart Lima for Tingo Maria where we will conduct interviews with farmers and begin the analysis for our economic models.
This experience has certainly pushed the boundaries of my comfort level given the broader scope of the work on this project and the need to transition to speaking a foreign language. In terms of our work, Kai and I are collaborating on the different models and helping to focus each other on specific tasks that will ultimately result in a successful analysis. I am also focused on improving my Spanish skills, especially given our upcoming departure for Tingo Maria.
That is all from Lima. Next update: Tingo Maria!
The EEP in Nicaragua/El Salvador has finally begun! PIMCO colleague Scott Argyres and I arrived to Managua on Saturday night (my bags made it one day later), which gave us a full day on Sunday to get settled in. The regional director at TechnoServe, Ryan Bathrick, was nice enough to personally pick us up, and he returned to our hotel Sunday morning to show us some of the local sights before staring work on Monday. So admittedly, this first blog entry (written on Monday) will be more cultural than project-focused, but that balance will soon reverse as we get deep into researching the daunting issues faced by El Salvador’s coffee farmers and other industry participants.
The first stop on our Sunday excursion was Laguna Apoyo, a geographically stunning crater lake. Laguna Apoyo reflects Nicaragua’s volcanic history – it was formed by an imploding volcano cone some 20,000 years ago. Today it is popular among both locals and tourists, just 40 minutes outside of Managua.
We then went to meet some of Ryan’s friends in Granada. One of them, Francisco (Frank) was very cordial and explained some key points of Granada’s history. Granada was the first European-founded city in the mainland Americas, by Spain in 1598. In the mid-1800s, the city (and country) was actually taken over by an American from Nashville – William Walker – who eventually proclaimed himself President of Nicaragua. Not surprisingly, this wasn’t well received in the region, and a Central American coalition forcibly removed Walker roughly a year later, but not until Walker had ordered the burning of much of the city, leaving a sign that read “Here was Managua.” After periods of restoration, Granada is now a very popular destination, offering some of the finest colonial-era architecture in the country.
From there, Ryan and Frank took our group for a little boat cruise of Lake Nicaragua, which is adjacent to Granada. It’s a massive lake, 19th largest in the world, and has hundreds of little islands that were created from volcanic eruptions. This picture, with nearby Volcano Mombacho in the background, looks calm. But 30 minutes later an absolutely torrential thunder storm blew in from across the lake. Yes, August is still the rainy season in Nicaragua!
Monday morning saw our first day in TechnoServe’s Managua office, pictured below. Between Ryan’s introductions and a morning staff meeting, we’ve now met everyone. All the people have been absolutely welcoming and helpful. The day for me and Scott consisted of continuing our research into El Salvador’s coffee industry and a 90 minute meeting with a coffee industry expert who laid out key challenges faced by the coffee farmers and his vision for the future. All signs point to this being a very multi-faceted problem with no apparent “low hanging fruit” solutions, but we’re eager to continue our research and bring a fresh perspective to the mix.
The coming week entails a lot more “get up to speed” research by me and Scott before we head to El Salvador on Sunday afternoon. I’m expecting continued advancement in our coffee knowledge and Spanish skills by this time next week!
Our first two days in Nicaragua have been incredible. I’ve been overwhelmed by the generosity and hospitality of both TechnoServe staff and locals alike. The landscape of the country is spectacular with volcanoes and green hillsides around every corner.
We spent our first weekend visiting the city of Granada, an old colonial city situated near Lake Nicaragua. The lake is known for 365 small islands (“Las Isletas”) that were formed during a volcanic eruption. Our trip was cut short by an unexpected thunderstorm, but we made sure to try some of the local cuisine before heading back to Managua.
Monday was our first day of work, and after meeting with a coffee industry expert, I couldn’t be more excited to start working on our project. The problems facing El Salvador’s coffee industry are severe, and the need for a timely solution is evident. Next week we will leave Managua for El Salvador, where we will begin conducting interviews with participants from all parts of the value chain (from the farmer to the exporter). I’m really looking forward to seeing firsthand how a small red fruit on a tree makes its way from the farm, to the futures market, and eventually to the cups of millions of people around the world.
Last week we discussed in more detail our project, which is to evaluate drivers of the economic viability of a centralized wet mill for coffee. Wet-milling consists of the first of several processing steps in coffee production that happens right after harvesting the coffee cherries; this includes de-pulping, fermentation, washing and drying the coffee beans. Jordan and I have prepared questionnaires for coffee farmers and operators running existing wet-mills. Many farmers in the region around Tingo Maria do not have access or do not use a central wet-mill, but process the coffee cherries at home or close to their fields.
On Thursday, we visited a fair just outside Lima, where we had the chance to taste locally manufactured food. TNS also had set-up a stand promoting chocolate producers from the San Martin region. We were told that the increasing local chocolate manufacturing has also increased local demand (despite the hot weather), which was no surprise to us as they taste great.
Friday morning Jordan and I flew out to Tingo Maria for our first field visits during the next two weeks. The climate here is tropical, humid and hot during the day, but it cools down during the night. The mountainous tropical forest around the town is scenic. After getting to know the office and most of the staff on Friday, we were invited to see the waterfalls close to ‘Tingo’ which are beautiful. On Saturday morning and on Monday we conducted our first interviews with farmers and plant operators. The TNS colleagues have been very helpful and supportive taking us to farms, fields and plants as well as explaining to us the details of the processes. The interaction with the farmers and operators was very interesting and insightful, as we have received a range of opinions on the topic and were able to filter out some data points for our analysis.
Coffee beans laid out for drying on the side of the road
We have completed our first week of work on the coffee project. So far, we have a draft of the condensed presentation from last year’s PIMCO volunteers and have completed nine (9) interviews with coffee producers and wet mill operators. We have also built preliminary versions of the economic models as we attempt to find data points to populate the constants in the models.
Last week, we spent our days in the Lima office where we did preparatory work and research for our interviews with producers, co-operative members and mill operators. While in the office, we were able to attend “El Feria de Hogar” which is an annual fair in the Chorillos district of Lima. The fair had some elements of an American fair (rides, lots of delicious junk food) but also some unique characteristics, like tents containing educational exhibits and Peruvian souvenirs. Also, some of the proceeds from the fair would be used for environmental protection and tree planting initiatives. We attended the fair because several of the chocolate producers that TechnoServe works with were present in a booth. They were raising awareness for and selling their chocolate product. (It is delicious!!)
On Friday, we flew into Tingo Maria on the one flight that travels between Lima and Tingo Maria each day. Tingo Maria is the small city in the Huanaco province where we will be based as we investigate the feasibility of a centralized wet mill. While Tingo Maria used to be considered the center of the “coca” drug trafficking business, in the past several years, it has become a hub of production of coffee and chocolate goods as well as a local eco-tourism destination. After getting settled into the office on Friday, we took a trip to see some beautiful waterfalls, “El velo de la novia.” These waterfalls form from the convergence of waters from the Amazonian hillside into the Amazon Basin.
Saturday, we began our work interviewing farmers in the region. We drove down a bumpy dirt road to meet with two coffee producers who work to pick the product off the coffee trees and then complete the de-pulping, cleaning and drying process at their individual farms. Coffee beans are actually found in the cherry fruit of the coffee trees and the pulpy fruit needs to be stripped away to reveal the beans, which then need to go through a fermentation process. This conversion from fruit to coffee bean is labor and time intensive, but with large distances and difficult terrain between the different coffee farms, it is difficult to establish a centralized milling facility in these areas.
We have met most of the TechnoServe employees based in Tingo Maria. Since the Tingo Maria office is new within the past year, much of the staff relocated from Tarapoto where the office was located previously. They have been incredibly kind and generous to show us around the city and some of the beautiful sites in the region. Although the town is more rustic, the scenery is absolutely beautiful and the people are incredibly open and compassionate. We have a busy week ahead, conducting interviews with producers and co-operative members in the area, as we continue to collect data from a large enough sample to create inputs for our economic models.
The PIMCO Foundation|
650 Newport Center Drive|
Newport Beach, CA 92660|
No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. Pacific Investment Management Company LLC, 650 Newport Center Drive, Newport Beach, CA 92660, 800-387-4626. ©2014, PIMCO.
Are you sure you would like to leave?
You are currently running an old version of IE, please upgrade for better performance.