Crisis talk is all over the front and inside pages of every newspaper. It dominates the radio news bulletins and the television news broadcasts. It's even infecting my Twitter timeline, but I'm going to resist adding to the speculation about the very real problem going on in the eurozone. Do I really have anything interesting to add? Will the euro still be around by the time you read this article? Will it even be in use by the time I finish writing this piece? I’ll talk to you about Fairtrade instead.
But actually, just before I get on to that subject, I would like to say a couple of things about the euro, for what it's worth (my opinion, I mean, not the euro). I rather like the currency – I'm one of those few Britons who regrets even now that we are not involved – and in the last ten years it has done me and my business quite a lot of good.
I also feel sorry for my friends over in Germany, although I think they are partly responsible for getting themselves into this pickle in the first place. It seems they weren't hard enough on member states like Greece and Italy, which had huge public deficits when they signed up to the project more than a decade ago. “Ja, ja, Herr White,” they admonish me gently, “20-20 hindsight is a wonderful thing. You better stick with your English pound sterling.”
This crisis in capital and financial markets, which comes on the back of the intractable burden of sovereign debt racked up by some EU member states, adds to the banking crisis of 2008 that originated on Wall Street. At the time, I thought our sector was protected against the swings and roundabouts of what it turned out were outrageous fortunes. If anything, I assumed, we would all stay home and eat more fruit and vegetables to comfort ourselves.
I had not counted on its impact on businesses in our sector. In the last few weeks we have seen something about how this might play out: in Belgium, Univeg said in early December it was restructuring its operations, “right-sizing” (?!) its staffing and going hell for leather to attract outside investors to its huge production portfolio and reduce its debt burden; in Israel, Agrexco has gone bust because it couldn't pay its way; in South Africa, Capespan shares have been heavily traded; and everywhere a major food retailer like Carrefour is up the proverbial creek without a paddle. The travails at Agrexco are similar to those of Italy and Greece – a debt burden that cannot be tamed by current growth rates. It seems they promised those that invested, the growers, far too much.
It is private equity and venture capital in the form of CVC that made Univeg the leading acquisitive force in the fresh produce business over the last few years. It has spent huge sums and taken on big debts to get to its current position, but my guess is that there is more to this story than just that. It will be fascinating to see whether the house that Hein Deprez built turns out to be on the flimsiest of foundations. The Belgian fellow is a much better architect than that, isn't he?
Damn, it seems I've run out of space to say something about that interesting article on Fairtrade I was telling you about at the top of this piece. It has some important consequences – Fairtrade is our elephant in the room at the moment – but you'll just have to read it for yourselves at nyti.ms/vRzp2a. Trust me, it is a welcome change from all those blasted articles and opinion pieces about crisis in the eurozone.
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