Lifeline for cocoa industry

•   Farmers removing cocoa beans from the pods.

• Farmers removing cocoa beans from the pods.

The African Development Bank (AfDB) and the International Cocoa Organisation (ICCO) have repositioned them-selves to boost business opportu-nities in Africa’s cocoa sector, including youth employment and empowering women participation.

The two institutions met in Abidjan, Ivory Coast, to strategise for cooperation to foster the transformation of the cocoa industry in Africa.

A statement issued and copied to the press said cocoa is one of the five Cs (cocoa, coffee, cotton, cassava and cashew) that have been selected for support under AfDB’s new Agriculture and Agri-business Draft Strategy.

Africa produces 73 per cent of world cocoa, with more than 70 per cent coming from Ghana, Côte d’Ivoire, Cameroon and Nigeria.

It is a major export earner, yet its production is still in the hands of ageing smallhold farmers with more than 70 per cent productivity losses as a result of numerous challenges.

The statement noted that the processing and marketing are in the hands of foreign investors.

While global cocoa production is valued at approximately $12 billion on the export market, with cocoa farmers receiving about $ 8 billion in revenue, the world chocolate market is valued at $110 billion.

The statement indicated that chocolate value addition in warehousing and other logistical services, chocolate production and packing, retail networks, and all associated logistics is 10 times the value of Africa’s cocoa exports.

Chiji Ojukwu, AfDB’s Agriculture and Agro-Industry Director said: “The large potential and opportunities offered by the cocoa sector have not been fully exploited by producing countries, nor have they taken advantage of existing technological progress and innovations in the way other commodities have.”

Cocoa is still produced by impoverished smallholder farmers, and most cocoa producing countries continue to export cocoa beans as raw materials, without adding value.

Within the global value chain, most of the money is made after the beans have reached the North. At the same time many cocoa farmers and workers in the South have to get by on less than $1.25 a day, below the threshold of absolute poverty.

“Cocoa growers today receive about six per cent of the price that consumers in rich countries pay for chocolate. In the 1980s their share was almost three times as great: 16 per cent.

“As a result, the African cocoa sector faces considerable challenges that need to be addressed in order to sustain or even increase its contribution to the economies of producing countries,” the statement said.

Aly Abou-Sabaa, AfDB’s Vice-President in charge of Agriculture, Water, Human Development, Governance and Natural Resources said: “A transformation agenda is required, where cocoa farmers would embrace a business approach and where activities to add value to the raw material would thrive, and generate growth, employment and additional revenues for cocoa stakeholders on the African continent.”

There is a huge potential to increase value addition in Africa, which would be a source of economic diversification, job creation, tax revenues and, indirectly, improvement of farmers’ incomes. New cocoa and chocolate products made available to African consumers would also lead to increased consumption in the continent, which represents only four per cent of global consumption.

AfDB and ICCO agreed to seek ways to strengthen their cooperation in a series of domains, such as value addition and promotion of cocoa and chocolate consumption in Africa, access to credit, market access and commodity exchanges, adoption of profitable cocoa farming models and thriving cooperatives, logistics and transportation.

They are committed to empower women in the cocoa value chain. Cocoa production is a very labour-intensive activity and therefore a source of rural employment.

Many activities in cocoa production, post-harvest processing, marketing functions and value addition could represent a viable source of revenues for women leading to their economic empowerment.

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