What happens when you are a tea farmer from the Chinese countryside and your buyer receives shipment of your tea, disconnects his phone line, and disappears without paying? That is exactly the situation of a Dong friend of mine right now.
I do not want to suggest this is a common occurance, but once is enough to cause very serious damage. What can a rural tea farmer do when the buyer is half way across the country? What affects will this leave on the local economy? How can crop theft be avoided?
Fortunately, this is not a common occurance. Several middle men from the East Coast of China hang around Sanjiang waiting to buy tea to ship back East. Another of these middle men (not the thief) told my friend the tea farmer that the guy who has disappeared had not only stolen tea. He had taken a loan from the China Post, received this shipment of tea, and borrowed money from others. In all, he has more than CNY 100,000 (US$12,500) of other people's money and resources.
My tea farmer friend said it would have been fine if the phone were still connected. "I am more than willing to wait, even till next year, to receive the money for the tea." But letting go of CNY 20,000 (US$2,500) worth of tea is not an option for rural, agriculture-based businessman.
The only thing he knows to do is go find the buyer. He has to travel across the country to do so, but he says the buyer will most likely be easy to find.
He used to work for a 'work unit' and they will know where to find him. What I do not know is what to do then. I just need to find him first and see what he says. He probably will not have the money if he has borrowed from all these other people, but even if I can just get possession of the tea, I will be in a much better situation than now.
Many locals had done business with this guy. He has been around for quite a while and was certainly no less trustworthy than all the other middle men hanging around buying tea. Nobody saw this coming, and hopefully, there will not be more widespread repercussions.
Most of these rural tea farmers are little more than peasants, and when somebody loses CNY 20,000 to one of these middle men, there is a decent chance the tea farmers will be much more reluctant to sell without more assurances of payment. I doubt it will affect the market much though, because these farmers will still need the money enough that they will have to sell in the end, but maybe with some hesitation, now.
The bare truth is that many of these business deals have few ways to ensure nobody can cheat and nobody can have their goods stolen. In a perfect world that would be possible, but in the real world it is not always possible. It really does come down to finding trustworthy business people with whom to deal.
There is always room for improvement in the system of things. However, the peasants are the ones at risk and they will most likely not step up in a coordinated effort to champion the cause of fair business practice and an improved systems of accountability. Are there simple ways to build accountability into the daily business of people like tea farmers?
In the end, when some businessman from the East starts going into debt and does not know what to do, something has to give. A peasant who lives several provinces away is a tempting target.
Can they be made a less tempting target? Could a co-op of tea farmers have the authority and backing to go after guys like this? Could such an association be able to provide more security to tea farmers and develop a system of selling that would be less susceptible to malicious business practice?
