Colombia’s FNC Shuts Down NY, Tokio Office As Part of Cost-Cutting Initiative
Coffee Network (Bogota)- The Colombia’s coffee growers federation has decided to shut down offices abroad as a part of a cost-cutting initiative to reduce expenses by 20% and in a bid to please the Colombian president.
The coffee growers federation FNC said it is shutting its NY office while it has accepted the resignation of its director Juan Esteban Orduz. It is also shutting down the Tokio office.
“The reorganization of that office (NY) entails the non-replacement of that position and the activities carried out there will be assumed in part by the staff present and headquarters in Bogotá,” FNC’s new general manager German Bahamon said in X, formerly known as twitter over the weekend.
Orduz was facing high scrutiny as the money of lease contracts for the office in New York, which is owned by the National Coffee Fund, was not transferred to the National coffee fund. Orduz said the rent of the NY office was US$7,000/month and such money was not transferred to the Coffee Fund because it was used to finance the expenses of the NY office.
As the National Coffee Fund is a parafiscal fund, Bahamon asked the finance minister to intervene in the decision of the rent of the NY office.
“I have asked the Minister of Finance and Public Credit for his collaboration to advance the legal procedures that allow presenting to the National Committee the alternatives for the disposition of properties in New York and Tokyo to improve the income of the National Coffee Fund and thus meet the needs of the coffee growing,” Bahamon said.
FNC aims to reduce expenses at the Bogotá headquarters by 20%.
Within this purpose, seven management positions have been eliminated including the position of Orduz, and instructions regarding the elimination of superfluous expenses such as memberships in social clubs and television subscriptions, among others.
Although the coffee growers federation does not say who else has left. Two months ago, it dismissed the press officer, Martha Sanchez, who held that position for about 17 years. People familiar with the situation said the commercial manager of FNC Juan Camilo Ramos also left.
“I indicated that one of the challenges and purposes would be to sustainable union and austerity, in addition to a coffee clamor, is an element fundamental for that purpose,” FNC said in a statement signed by Bahamon on Saturday.
Speaking from the coffee-largest producing province Huila, President Gustavo Petro requested Bahamon’s resignation claiming that FNC has huge expenses that do not reflect the reality of coffee growers. Petro said Bahamon earns COP200 million /month and such salary should be reduced.
“A coffee grower today, an average peasant, earns 12 million pesos a year. How much does the president of the National Federation of Coffee Growers earn? How can there be a president representing the coffee union when the average income of a coffee grower is 12 million or 20 million a year and he earns 200 ( million US$51,300) ? That cannot be,"Petro recently said.
Bahamon said his salary is no more than 30% of the COP200 million. But people familiar said his salary is around COP150 million/month.
It is unknown if part of the cost-cutting expenses includes reducing Bahamon’s salary.
FNC declined to clarify such information.
“The search for efficiency has as its pillar the generation of awareness collective regarding the imminent need to give birth to a culture of austerity built from concrete situations that allow the
rearrangement of the union, to transfer more and better benefits to the coffee farmers,” Bahamon said.
“The transformation of the FNC began 4 months ago and we have a measurable objective and
challenger to reduce 20% of the operating expenses of union companies at the headquarters in Bogotá when the first year of this new management is completed,” he concluded.
By Diana Delgado
