Liberalize Ghana’s Cocoa Sector – CAL urges Government

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The Centre for Agro Liberty (CAL), at the Institute for Liberty and Policy Innovation (ILAPI), a free market and public policy research organization in Tema, has called on the government to liberalize the purchase and exportation of Ghana’s Cocoa.

The Center, in a statement issued on Tuesday, October 9, 2018, by and signed by two of its Directors Danso Abiam and Sammy Adjei, said,

“We need to emancipate Cocoa Farmers from the long-standing policy of governments controlled Institution that fixes the price for Cocoa in Ghana. This gives the farmers no choices of whom to sell to for on price bargain.

“It is time for Cocoa Farmers to price their own Cocoa, form associations and export for dividends that satisfies them!”

According to the Center, government said, the price-fixing was to protect Farmers from the volatile prices on the world market which the government itself do not have control over. This command economic system gives no room for price competition and a control of what farmers produce regarding sales and exports. Why is government not fixing the prices of products from industries, like say plastic chairs but for cocoa?

However, the statement indicated that, “Cocoa production declined since the mid-1960s, reaching its lowest level in 1983. Although production has increased consistently since the mid-1980s, it is still less than the level attained in the mid-1960s.”

“The main industry regulator which is the Ghana Cocoa Board (COCOBOD), plays all major roles in linking the smallholder farmers to global markets. And this has become a big challenge in agricultural development across the African Continent. The regulator manages all internal prices for cocoa and pretends to provide relevant inputs and other services to the farmers to enhance productivity in a form of free agriculture inputs such as fertilizers,” the statement revealed.

CAL’s findings showed that, government had since 2014, not lived up to its promise of making fertilizer readily available to the farmers. Only half of the budgeted quantity of fertilizer in 2014 and 2015 were made available to the farmers, with the situation not being any different moving forward.

CAL had again noted with regret that there had not been any official information explaining what has led to such situations.

“Government interventions have ushered cocoa farmers into destitution and are still living way below globally defined poverty levels, which is $2 a day. The lack of a decent livelihood for cocoa farmers contributes greatly to bad labour, human rights violations, child labour, and its related problems in the cocoa supply chain. The future of Cocoa is no longer attractive. Thus, the younger generations are largely drifting away from Cocoa Farming, whilst the life expectancy of the older farmers are also aging away.

“Farmers have no control over decision-making, thus cocoa is largely purchased and sold to the global market through the government.

“The unfair distribution of value and power in the cocoa chain also contributes to the root causes of the extreme poverty for cocoa farmers. And again, merging and takeovers have resulted in only a few companies dominating up to 80% of the whole value chain, whereas farmers who suffer to produce the cocoa lacks the right to be a part of the decision-making process.

“The sad aspect of it all is that, the percentage score of poverty rate among all cocoa growing regions is higher than the non cocoa growing regions according to Ghana Statistical Service report. Why must the Cocoa Farmer be poor when his product has hinge to Ghana’s GDP?

“However, no matter what government regulations may be, if the price-setting mechanism is not addressed, cocoa farmers will still remain poor. There will be no future cocoa farmers, Unless the cocoa sector fundamentally changes,.

“Cocoa farmers all over the country are threatening to halt production if government does not listen to their plights, following its announcement to maintain cocoa producer prices at Gh¢475.00 for the 2018/2019 cocoa season on 1st October, 2018.

“We say, government of Ghana has disappointed Cocoa Farmers, because they don’t understand why the Prices of Cocoa have been maintained since 2016 to 2019 season,” the centre strongly noted.

“We recommend that; Government has to allow cocoa farmers to price their own produce like cashew and any other cash crops.

* Cocobod should rather be the tax regulator in stead of being the governme-controlled institution that fixes the buying price for cocoa.

CAL is therefore, giving government a one month ultimatum to address these concerns or else, we will lead a nationwide demonstration, and cocoa farmers nationwide will seize to sell their cocoa to the government,” the centre stated.



Danso Abiam

Tel: 0244033571

Sammy Adjei

Tel: 0246330513

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