By Africa is set to become a great hub for cocoa production. Cocoa production in Africa is set to take a turn for the better, as the African Development Bank (AfDB) begin plans to support producers of the crop on the continent. This will no doubt bring about economic growth and development.
In addition, among other planned interventions, the Bank is considering support to Ghana and Côte d’Ivoire to reduce the volatility of the international prices of cocoa. Côte d’Ivoire leads the world in the production and export of cocoa which has been a great achievement over the years.
Reports confirmed that Ghana and Côte d’Ivoire are now at the final stages of discussions for AfDB support. A final deal is expected to be announced in the days to come. But following high-level meetings between the governments of both countries and the AfDB President, some key agreements have already been agreed upon which have shown a sign of approval to the deal.
Further more, the Bank has agreed to assist the countries to establish a Cocoa Market Stabilization Fund and a Cocoa Exchange Commission for the management of production. Also, the AfDB has also agreed to work with them to establish a Cocoa Industrialization Fund to further grow the cocoa industry. The Fund will help in developing the regional markets for by-products and domestic processing for targeted African regional markets. The overall objective is to stimulate and expand consumption.
However, the two countries have jointly requested for US $1.2 billion for mutually identified projects: to tackle the cocoa swollen shoot virus disease; build storage and warehousing facilities; promote processing and consumptions; establish the Africa cocoa exchange; and to establish the stabilization fund to sustain and develop the commodity production.
Adesina stressed that although Ghana and Côte d’Ivoire produce 64% of the world’s cocoa stating that they play important role in the world market industry:
“AfDB has received a request for $1.2 billion from Ghana’s Minister of Agriculture and from the Cocoa and Coffee Board of Côte d’Ivoire. We are looking at building warehouses so you can store the cocoa and not have to sell immediately after harvest.”
Similarly, he explained the importance of farming and how important it is to generate fund in the sector:
“We must use agriculture to create wealth for our farmers. To do this, we must make sure that we add value and process everything that we produce. Agriculture is not a way of life. Agriculture is a business.”
Also, Chief Executive Officer of the Ghana Cocoa Board (COCOBOD) Joseph Boahen stressed the need to stimulate local consumption as part of efforts to enhance production. He spoke when the AfDB President visited the Cocoa Processing Company (CPC) in Tema, a city near Accra, Ghana.
“Africa consumes very little of cocoa. Ghana is an example of a cocoa-producing country where local consumption is very limited. Value addition is the only way we can have a say in the market. As it is now, international prices are determined either at the New York Stock Exchange or the London Stock Exchange. We do not have any say.”
Many believed it is important for farmers to generate fund from this commodity. Ghana’s Minister of Finance, Ken Ofori-Atta, called for support to increase the country’s earnings from the commodity:
“Between us and Côte d’Ivoire, we control 60-70 per cent of cocoa in the world. But we have remained price takers. That should not happen. That is because our leaders have not been working together. We are excited that the President of the AfDB is stepping in to help us. We are now working together to see how we can transform this industry.”
It has been revealed by Ofori-Atta that though the cocoa seeds alone generate US $140 billion worth of business, Africa earns very little from it:
“Ghana and Côte d’Ivoire are putting together a package to see how we stabilize and ensure that we get better deals in the future and change the fortunes of our farmers. We should be able to pay our farmers competitive prices.”
AfDB has promised to assist cocoa producing African countries. These countries have marked out plans to invest in cocoa production. This is a great step to further strengthen cocoa production industry in Africa.