How I Got Into Coffee Smuggling
Alf Mildenberger
My own experience with coffee smuggling was from 1969 to 1973....during the highpoint of smuggling from Switzerland to Italy. I had moved to Switzerland from New York and was hired by USEGO Olten, a major coffee roaster. Based on my experience as a coffee trader in the American market I was put in charge of the coffee department. Part of my job was dealing with coffee that was to be smuggled from Switzerland to Italy. I was curious and wanted a firsthand look at how it worked so I took a drive. The trip from Olten by car took 6 hours on a mountainous road twisting over two passes. Traveling from St. Moritz across the beautiful Bernina pass and onwards to the valley of Puschlav (Poschiavo in Romansh), the valley air filled with blue smoke and the strong scent of roasted coffee. This experience is still strong in my memory. This is my story as I lived it.
Switzerland was not a wealthy country as it is today and many Swiss left for the USA to find a better life. Especially hard hit were the border regions. High unemployment and poverty created a hard life, particularly in the area of the Puschlav valley. The poverty was on both sides of the Swiss/Italian border with hardly any employment available. Coffee has always been an integral part of the Italian lifestyle. Knowing that Italians would pay a high price for this daily necessity, their government raised import taxes on coffee.
Since coffee, a tropical crop, is grown only between the Tropic of Cancer and the Tropic of Capricorn, Europe needed to import 100% of its demand. Switzerland also applied tax on coffee, but at a much lower rate. The cost for coffee roasted in Switzerland was much lower than the Italian product and this price difference made smuggling possible. From some parts of Switzerland getting coffee into Italy was fairly quick. One hiked across a mountain pass and crossed the border. However, it was hard & treacherous work.
The Swiss government knew that large quantities of coffee were smuggled into Italy but before that could happen it needed to be imported Into Switzerland. Of course import tax was due and collected by the Swiss tax man. Now the coffee could be roasted and smuggled into Italy. This operation was very elegantly called EXPORT 2 by the Swiss tax authorities. The Swiss government kept the taxes collected from Export 2 coffee apart from taxes collected on coffee for Swiss home consumption The EXPORT 2 duty collected was used to fill the coffers of the Swiss Social Security, reaping over one billion Francs. At its peak more coffee was roasted for Export 2 than for the whole of Switzerland. Click here for the rest of the story!
Be sure to checkout the videos & web sites by clicking on the highlighted links above.
Alf Mildenberger
My own experience with coffee smuggling was from 1969 to 1973....during the highpoint of smuggling from Switzerland to Italy. I had moved to Switzerland from New York and was hired by USEGO Olten, a major coffee roaster. Based on my experience as a coffee trader in the American market I was put in charge of the coffee department. Part of my job was dealing with coffee that was to be smuggled from Switzerland to Italy. I was curious and wanted a firsthand look at how it worked so I took a drive. The trip from Olten by car took 6 hours on a mountainous road twisting over two passes. Traveling from St. Moritz across the beautiful Bernina pass and onwards to the valley of Puschlav (Poschiavo in Romansh), the valley air filled with blue smoke and the strong scent of roasted coffee. This experience is still strong in my memory. This is my story as I lived it.
Switzerland was not a wealthy country as it is today and many Swiss left for the USA to find a better life. Especially hard hit were the border regions. High unemployment and poverty created a hard life, particularly in the area of the Puschlav valley. The poverty was on both sides of the Swiss/Italian border with hardly any employment available. Coffee has always been an integral part of the Italian lifestyle. Knowing that Italians would pay a high price for this daily necessity, their government raised import taxes on coffee.
Since coffee, a tropical crop, is grown only between the Tropic of Cancer and the Tropic of Capricorn, Europe needed to import 100% of its demand. Switzerland also applied tax on coffee, but at a much lower rate. The cost for coffee roasted in Switzerland was much lower than the Italian product and this price difference made smuggling possible. From some parts of Switzerland getting coffee into Italy was fairly quick. One hiked across a mountain pass and crossed the border. However, it was hard & treacherous work.
The Swiss government knew that large quantities of coffee were smuggled into Italy but before that could happen it needed to be imported Into Switzerland. Of course import tax was due and collected by the Swiss tax man. Now the coffee could be roasted and smuggled into Italy. This operation was very elegantly called EXPORT 2 by the Swiss tax authorities. The Swiss government kept the taxes collected from Export 2 coffee apart from taxes collected on coffee for Swiss home consumption The EXPORT 2 duty collected was used to fill the coffers of the Swiss Social Security, reaping over one billion Francs. At its peak more coffee was roasted for Export 2 than for the whole of Switzerland. Click here for the rest of the story!
Be sure to checkout the videos & web sites by clicking on the highlighted links above.
