EconomyFact Check

The global cocoa industry and ‘flexing of muscles’ by Ghana and Cote D’Ivoire 

A TikToker makes several claims, including an allegation that Ghana and Cote d’Ivoire failed to attend a cocoa conference on October 26 and 27 in Brussels because they disagreed with the European Union’s demand for them to purchase carbon credit.

DUBAWA will subject a number of the claims to critical scrutiny and provide a verdict for the same.

Full Text

An almost three-minute TikTok video, circulated by @rohrsteam, discusses the cocoa sector with a global perspective and the major role Ghana and Ivory Coast play in that sector.

The video raises several issues in the sector and why Ghana and Cote d’Ivoire didn’t attend this year’s Cocoa Partnership Agreement. Among other things, this is what the TikToker had to say:

“It [the cocoa industry] is about a 100 billion-dollar industry, of which Ghana only gets about six per cent, which Ghana was okay with until the European Union threatened them with sanctions if they didn’t become more environmentally friendly. Ghana asked the European Union what they had to do to be more environmentally friendly, and one of the suggestions that were made was that Ghana could purchase carbon credits, essentially paying someone not to pollute. So what the European Union said to Ghana was if you [Ghana] pay us [the EU] not to pollute, we will overlook you not being environmentally sustainable.

“As you can imagine, this ticked off their government quite a bit. So the president of Ghana wanted to get in front of this issue and not have leverage over him, and he made a bold proclamation that Ghana would not sell cocoa in the same way they had been selling it to their western trading partners; instead, over 50 per cent of the cocoa would be processed right in Ghana… and in a power play out of a business negotiation handbook. Cote d’Ivoire and Ghana both boycotted the Brussels cocoa conference this year, showing that they were going to be very serious about their independence from the European chocolate manufacturers,” he alleged.

He further suggested that the two countries failed to attend the World Cocoa Foundation 2022 Partnership meeting because of a payment disagreement between them and the EU. He adds that the two countries wanted to show their Western trading partners that they could do without them.

This video has generated a huge amount of interest on social media, partly because of the significant role the cocoa sector plays in Ghana. Over 20,000 people have shared the video, with a little over 13,000 comments.

DUBAWA finds the claims made in the video fascinating and worth investigating and has been combing through the websites of the World Cocoa Foundation and the Côte d’Ivoire-Ghana Cocoa Initiative and credible online news portals. 

Background

The Partnership Meeting is convened by the World Cocoa Foundation (WCF). The WCF is a non-profit international membership organisation comprising governments, civil society, and cocoa-growing communities, partnering to ensure sustainability along the cocoa supply chain. Thus, the WCF focuses on three goals: increasing farmer income, combating child and forced labour, and ending deforestation in Cocoa. To achieve these, stakeholders, including Ghana and Cote d’Ivoire, who produce more than 60 per cent of the world’s supply of Cocoa, hold annual Partnership Meetings to, among other things, discuss prevailing issues and chat courses to contain them.

Claim: Ghana and Cote d’Ivoire boycott Brussels meeting over carbon credits.

Verdict: Misleading. Checks by DUBAWA indicate that it is true that Ghana and Cote d’Ivoire didn’t attend the Brussels meeting. However, the reason provided by the Tik-toker for the boycott by the two countries is misleading. 

The refusal of the two countries to attend the meeting had more to do with the low-income levels of cocoa farmers in the two countries than it is with their disagreement with the European Union over the purchase of carbon credits.

A carbon credit is a long-term arrangement to fight greenhouse emissions. It allows countries to emit a certain amount of carbon and other greenhouse gases. If they exceed that percentage, they pay for carbon credit. 

However, the Spokesperson of Ghana’s Cocoa Regulatory body, COCOBOD, Fiifi Boafo, believes the well-being of farmers in the two countries remains paramount to them.

In furtherance of this objective to improve the well-being of farmers, the presidents of Ghana and Cote d’Ivoire, on March 26, 2018, set up the Cote-d’Ivoire-Ghana Cocoa Initiative (CIGCI) by way of reaffirming their willingness to define a common sustainable cocoa strategy, with a view to increasing the prices received by cocoa farmers in the respective countries in a sustainable fashion. 

The first of the three focal points of the Foundation is economic sustainability.

The Foundation’s other two areas of interest are social and environmental, respectively, in the forms of child and forced labour and deforestation.

To respond to these two issues, the governments of Cote d’Ivoire and Ghana, together with 35 leading cocoa and chocolate companies, joined the Cocoa and Forest Initiative in 2017, according to the information on the Foundation’s website, and the two have achieved great strides.

Even though Ghana and Cote d’Ivoire have taken steps and chalked some successes in dealing with the issues of child and forced labour and deforestation, as agreed, the Foundation is yet to consider the plight of the countries’ cocoa farmers. According to the CIGCI, the Foundation seems to be more interested in ensuring the two countries achieve more in the first two areas than in ensuring better remuneration for cocoa farmers, thereby making them boycott this year’s confab.

“It has always been, ‘Deal with child labour, deal with deforestation’, but how can the farmer ensure the sustainability of the industry where the industry has always pushed the price down?

“Our members are not happy with the state of play, and we want to send a clear message that we will not undermine the livelihoods of farmers,” according to a statement detailing the reason for the boycott, which was signed by the Executive Secretary of the CIGCI, Alex Assanvo, on October 25, a day before the meeting was to open, and reported in the media.

The researcher, to get data to support this report, contacted the cocoa regulatory body in Ghana, the Ghana Cocoa Board. The spokesperson for the Board, Fiifi Boafo, confirmed the reports. According to him, cocoa industry players have taken the farmers for granted for a long time and have instead been concerned about their interests. Hence, they saw a boycott as a viable tool to reflect the plight, register the displeasure of the cocoa farmers, and call their partners’ attention to the need to redress such concerns.

“We didn’t see the need to attend the meeting, and it was a way of demonstrating to our partners that we are not pleased with how things have gone. Of course,  the meeting was to discuss sustainability, which is the environmental, social, and economic. The environmental talks about deforestation; the social talks about child labour issues, but the economy has to do with the income and sustainability of the industry players. 

“We thought that [the economic sustainability] has been pushed under the carpet and has not been given the needed attention, so we were to draw attention to the fact that there was something equally important to be discussed. So, if that was not a matter of consideration, we did not see the point in participating in the meeting. So, that was the reason for our boycott,” the Ghana Cocoa Board PRO confirmed to DUBAWA.

Concerning the purchase of carbon credit, Mr Fiifi Boafo revealed that the EU is considering a bill that would restrict its importation of cocoa from countries that pollute their environments or destroy their forest covers to plant the cocoa and make such countries pay for the level of pollution or destruction. He explained that before the conclusion for a country to purchase carbon credit arrives, there would be a carbon audit to assess the level of environmental pollution or forest cutting.

“It is not paying money to the EU specifically, but if we get to the carbon credit payment, any country polluting the system will pay. That is, if you are reducing your forest cover, then you will pay.

“But we are not there yet. They have to do a carbon audit to come to that conclusion. There will be a validation whereby they will assess whether the rate at which a country is polluting its environment or cutting its forest. When they have done this, they can categorise that country as low risk or high risk. Even the validation hasn’t taken place. We are not there yet,” he concluded.

Claim: Ghana to process 50% of its cocoa production?

Verdict: Partly True

DUBAWA came across President Akufo-Addo’s proclamation that Ghana will process 50 per cent of Ghana’s cocoa beans. The promise to ensure 50% processing capacity will be achieved in a three-year programme. He did not, however, specify the percentage increase for each year. However, the presidential proclamation was out of the belief that the policy, if successfully implemented, would aid in the government’s commitment to add value to Ghana’s raw cocoa materials and enhance agricultural productivity in the long run.

Mr Boafo of Ghana Cocoa Board has said the 50 per cent is a projection government hopes to achieve. He added that the decision to process 50 per cent of its cocoa produce was internally informed to ensure employment creation, value addition, and revenue generation.

“In 2017, Ghana was processing only about 20 per cent of the cocoa it produced. Then there was a directive from the president to the managers of the Board that Ghana should work towards processing 50 per cent of its cocoa beans. The government’s decision aimed to ensure that we add value to the beans, not just export them raw. Apart from adding value, it also generated more revenue and created job opportunities, especially for the teeming youth population. We are not there yet; we are doing around 43 per cent,’ he concluded.

DUBAWA found a GCB-sponsored Cocoa industry analysis for 2022, which suggests that 30 to 34% of Cocoa production is currently being processed in Ghana. Page 12 of the document also confirms the government’s projection to increase processing to 50%.

Conclusion

From our verification, while it is true that Ghana didn’t attend this year’s cocoa conference in Brussels, Belgium, it is false that the boycott was a result of the EU’s demand that Ghana purchases carbon credit.

Neither is it true that Ghana’s resolution to process 50 per cent of its cocoa beans is because of a disagreement between it and the EU. According to official sources, Ghana didn’t attend the Conference because the Conference failed to heed its demand for better incomes for its cocoa farmers. Its decision to process 50 per cent of its cocoa beans is also economically inspired. This is to create employment for the population by adding value to the raw cocoa and generating more revenue for the country.

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