IMG-20140914-WA0014Cocoa tree is assumed as a native tree of the Amazon basin and other tropical South and Central America. Carolus Linnaeus renamed the cocoa tree theobramo cacao which literally means ?food of the Gods?. ?Hernando Cortez was the first person who imported cocoa to Spain from South America in 1528. Many South American countries particularly Ecuador embraced and participated in cocoa production. At the end of the 17th century European nations (Curacao of Holland, Guyana and Grenada of France, Great Britain and Hispaniola as it was called then) engaged in cocoa production. In the 19th Century, this ?magic seed? was introduced to the African soils. Principe, Sao pome, Nigeria, Fernando po and later Ghana became the first African countries to start cocoa production. Today, Africa particularly West Africa (Ghana and Ivory Coast) is taking commanding lead in the production of this cash crop.

Aside gold, cocoa comes to mind whenever Ghana is mentioned.? The Cocoa sector alone employs over 700,000 (this figure greater than the public servants in Ghana) farmers in the country. As history chronicles, Cocoa was introduced in the southern region of the Gold coast in the mid 19th century by a gallant patriot cum commercial farmer (Tetteh Quarshie). He intelligently but miraculously transported this seed from Fernando po and first planted the seed at the Eastern region districts of Akuapem. Farmers from other regions in the country replicated the production of this crop. It is worthy of note that this crop can thrive in almost all the ten regions of Ghana. Most cocoa plantations in Ghana are family farms and cover between two (2) to ten (10) hectares of land. In Ghana as well as in many African countries, the cocoa beans are harvested in September/October and may continue until January/March.

The Ghanaian cocoa sector has had a checkered success story. There have been several good times and bad times for this sector. For example, but for this sector, a facility would not have been procured by our first president Osagyefo Dr Kwame Nkrumah to build the Akosombo dam (the leading power supply source for the country since independence). Again, Cocoa Marketing Company (CMB) at its inception made profits to the extent that they were in good financial standing to grant soft loans to the government to share in the burden of the second Development plan of the country. This clearly indicates the cocoa sub-sector through the CMB was one of the spines for the public purse. No wonder the CPP government consciously took cocoa production seriously (channeled its energies to make the sector vibrant particularly in the early 1960s) to the extent that between 1960 and 1962, cocoa production reached an unprecedented level of 430000 and 580000 tons in 1964.

Despite the success stories as initially intimated, the sector has suffered several bruises. For example in the 1960s and 70s the sector nearly collapsed only to pick up signs recovery in the 1980s and recovered fully in the mid 1990s. In fact, there have been instances in the country history where cocoa trees were deliberated felled and destroyed to plant other crops like plantain and palm trees.

GENERAL DETERMINANTS.

There are several factors that determine overall national cocoa output for a particular year. The factors that determine cocoa production in the country can be grouped into sub themes, namely environmental factors, geographical factors and economic factors and social factors.

Under the environmental factor, several factors are considered. Prominent among them is availability of forest area. This looks at the ecology of the place. The ecological factors include but not limited to deforestation (no wonder cocoa production was all time low in 1983 when bush fires were the order of the day) and availability of pests and diseases. Any time pest?s attacks on cocoa become eminent in a particular area, cocoa farmers become demoralize and react in a way that affects cocoa production in that particular area thereby affecting the overall national cocoa output. ?For example Outbreak of pests and diseases (particularly swollen shoot virus) reduced production in the Eastern region in the early 1940s pushing cocoa cultivation further into the Western Brong Ahafo frontier (Amanor 2010). Not all but also, one of the major reasons why farmers shifted from cocoa production and deliberately cut down and destroyed a lot of cocoa farms in the late 1970s and the early 1980s was attacks on the cocoa by the swollen shoot virus.

Social factors are chief driving forces for migration. Migration affects labour supply for cocoa production. Labour works on cocoa farms so if a lot of dwellers in the cocoa growing areas shift their geographical location due to some social factors (unavailability of basic comfortable social infrastructure), the hands needed to cultivate the cocoa farms will not be enough hence reducing the total cocoa production. Economic factors include several factors but I will fully touch on this under a different thematic area.

INTERVENTION

The interventions made in the cocoa sector are in phases. The interventions or policy decisions are implemented due to the exigencies of the time. Over the years, the governments have made so many interventions to help solve some damning challenges the sector faced. Some of the interventions made are enumerated in the subsequent paragraphs

The Cocoa Marketing Board was formed in 1947 following a commission?s recommendation after serious misunderstanding ensued between the farmers and the foreign buyers in 1937. At the heart of the conflict was the dissatisfaction of the farmers due to low prices cocoa was bought by the European buyers. The commission submitted its report and made recommendation in 1938 but due to 1939 war, the recommendations were never implemented until 1947. The CMB was formed to give farmers more leverage on the European buyers and insulate them from price fluctuations on the world market

As initially intimated, the cocoa sector received promising signs after the implementation of the Economic Recovery Program in 1983 (under the PNDC government), which included a special program to resuscitate the cocoa sector (the cocoa rehabilitation project). The policies in this project included reducing smuggling (increasing the cocoa prices at the farm gates), devaluing the cedi (thus reducing the level of implicit taxation of farmers), compensating farmers for removing trees infected with swollen shoots and planting new ones. The cocoa Research Institute also assisted tremendously by developing high yielding cocoa varieties that led the sunken cocoa sector record good figures from the 1995/96.

It can be not be far from correct to state that the success stories can be chronicled from the 2001s. This was made possible due to high world market prices for cocoa during those periods coupled with these interventions instituted by the government and its allied cocoa organizations. The interventions included ??increased share being passed onto farmers and Interventions by the COCO-BOD to improve farm practices, mass spraying program to combat the activities of the swollen shoot viruses, serious promotion that led to adoption of higher and more frequent applications of fertilizer (vigneri and Santos 2008). Although the cocoa roads are still deplorably bad, feeder roads over the years have helped in linking up cocoa producing villages to the towns

MATTERS OF INTEREST

The testimony of the cocoa sub-sector to the socio-economic development is legendary. A serious direction and attention on this sector can largely turn the economy around within two (5) years. It is pathetically demoralizing to witness the less attention given to concerns and prospects of this sub-sector. Conscious leadership decision backed by practical action to make this sector attractive will go a long way to arrest unemployment, arrest the ailing cedi and bring hope and urgency into the citizenry. This can be done if these among other discussions take the front burner in the cocoa sub-sector.

Cocoa pricing. History has enough to teach us that, anytime there is cocoa pricing issue, farmers being rational economic agents find other ways to defend and maximize their interest. It the feeling of dissatisfaction about prices of cocoa that made farmers rebelled against the European buyers in 1937 which subsequently led to the creation of the CMB. ?When Nkrumah through his then minister of finance K.A Gbedemah introduced Cocoa duty and development funds (Amendment bill) in 1954; an initiative that gave the government the power to freeze cocoa prices (72 shillings per load to be paid to farmers) even though world market price for cocoa was high while raising export duties of cocoa, the cocoa farmers particularly those in Ashanti were mad and reacted strongly. It is an altruism that anytime the Ghanaian cocoa farmers feel cheated, smuggling of the Ghanaian cocoa into Ivory Coast becomes more pronounce. The government uses the Bank of Ghana?s (BOG) exchange rate as a yardstick to pay the farmers their due. The BOG does not directly trade with the Ghanaian public in foreign currencies but only averages the inter-bank exchange rates to arrive at its rate. The interbank exchange rate hovers between (GHS 3.7-4)/$1 but the BOG exchange rate is below GHS 3.1/$1. The spread (difference between the BOG and inter-bank forex rates) is about 22%. This clearly shows the probability that cocoa farmers will lose about 22% (all other things being equal) of their revenue due to this low BOG forex rate is almost equal to one. Stretching the argument, with this information to the farmers, the probability that smuggling will be pronounced in this year is also equal to one. When this happens, Ghana?s economy suffers while Ivory Coast benefits. In times where the national economy needs a lot of injection, any activity of cocoa smuggling will further reduce our economic prospects. Government should expedite action to reverse this looming economic danger.

Processing of cocoa beans. Over the years, a lot of lip service has been paid to diversifying our economy. Politicians mount platforms and eruditely articulate how the manufacturing sector if well pursued could turn the economy around. We are aware the manufacturing sector will do a lot but who is going to start the drive? I believe the best way to start this manufacturing drive is taking the processing of the raw cocoa beans for export serious. I read this news with joy on one of the local online portals ?The cocoa processing company limited (CPC) assured us that all challenges facing it has been resolved hence their preparedness to break into the West African sub-regional market?. After reading this news, I asked, will this be one of the political promises? Does the CPC have huge demand in Ghana? Are they are able to meet their local demands? ?What impedes them from meeting the local demand? How far have they gone in addressing those impediments? When will they fully address them? If all these questions are answered, I will bravely convince myself that we mean business now. Ghana?s cocoa beans and chocolate are adjudged the best in the world. We are unable to capitalize on this free advertisement to leverage on its benefits. It is not enough changing Valentine?s Day to chocolate day. It is a necessary but not a sufficient condition. What needs to be done is a serious commitment to create demand (within and outside Ghana) for the Ghanaian chocolate and devising practical steps to meet the demands. Processing cocoa will bring several benefits to us. The cosmetics industry will be boosted, unemployment will reduce drastically, there will be increase in the incomes of existing and prospective cocoa farmers, our gross domestic product will increase, our economic fundamentals will be turned around positively and last but not least the cedi will bounce back.

To conclude, another deliberate effort to make the cocoa sub-sector attractive is a serious look at the cocoa scholarship scheme. The scheme if I am correct was meant for children of cocoa farmers and other people within the cocoa value chain system. It is pathetic to note that, over half of the people on this scheme are people who have nothing to do with cocoa and may have not seen cocoa bean before. This defeats the purpose for the creation of this scheme.

Let us all work to encourage our illustrious farmers to keep producing the ?food of the Gods?. If those producing the food of the ?gods? are empowered, they will discharge their duties with cheerful diligence and when the ?gods? are satisfied, they will happily command blessings unto humanity. We need their blessings so we must attend to the needs of those who will expedite the flow of the blessings. Cocoa can turn the destiny of Ghana around and the earlier we looked at the needs of the people in that sub-sector, the better for all of us. Long speeches bring no results only actions do.

 

About the Author

Bernard Owusu Mensah (dnkowusu@gmail.com)

Founding President New Era Africa

Founder Goshen Investments Solutions

Policy/Investment Analyst

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.