Cocoa: Côte d’Ivoire and Ghana decide on a common strategy

After having decided to deploy joint storage capacities with the support of the AfDB, Côte d’Ivoire and Ghana are deepening their ambition to build a cartel around cocoa. On 26 March, on the sidelines of the Africa CEO Forum, Presidents Alassane Ouattara and Akufo-Addo signed an agreement called “Declaration of Abidjan” (see the declaration below) in which the two countries commit themselves to ” harmonize their cocoa marketing policy “.

In this case, the two countries that account for 60% of the world cocoa supply have decided to “announce each year, concomitantly and before the start of the campaign, the price to producers”. The agreement also stipulates that Abidjan and Accra will collaborate on research to develop better varieties and fight against Swollen shoot, a viral disease that plagues both countries and threatens the cocoa orchard.

Call for the African private sector

On the question of transformation, the states pledge to “transform the major part of their national production”, invite “the African private sector” to invest massively in this transformation and decide to “jointly promote the consumption of cocoa on the markets local, regional and emerging “.

The purpose of this partnership is, of course, a stated desire to control cocoa prices, which have fallen by 35 to 40% in the space of a year. A depreciation of the prices which strikes hard the public finances of the producing countries. Alassane Ouattara also recalled at the opening of the forum that on $ 100 billion of revenue generated by the cocoa sector, producing countries only harvest between 5 to 6%, the rest benefiting actors based outside the continent.

Below the “Declaration of Abidjan”

As part of the implementation of the Strategic Partnership Agreement between the Republic of Côte d’Ivoire and the Republic of Ghana, the two Heads of State, HE Mr. Alassane OUATTARA and HE Mr. Nana Addo Dankwa AKUFO-ADDO, have had a consultation devoted to the cocoa economy, of which both countries account for 60% of the world supply.

At the end of their exchanges, the two Heads of State decided to make the declaration entitled “Declaration of Abidjan”:

– Considering the sharp fluctuations in cocoa prices on the international market, marked by a fall of around 40% in 2017;
– Considering that this decrease had an adverse impact on the incomes of several million small cocoa producers, as well as on the budgetary revenues of the two countries;
– Conscious of the importance of cocoa for the economies of Ghana and Côte d’Ivoire;
– Desiring to accelerate the implementation of their common policy, aimed at better defending the interests of cocoa producers, as well as those of the economies of the two countries.

The two heads of state:

1. Reaffirm their willingness to define a common strategy with a view to finding a lasting solution to improving the prices received by cocoa producers in their respective countries;
2. Undertake to harmonize their cocoa marketing policies;
3. Agree to announce annually, at the same time and before the start of the campaign, the price to producers;
4. Agree to intensify collaboration on scientific research on the protection of cocoa plants, improvement of varieties, including the adoption and implementation of a regional program to control Swollen shoot disease;
5. Affirm their commitments to transform most of their domestic production in their respective countries;
6. Invite the private sector, including the African private sector, to invest heavily in cocoa processing in Africa;
7. Commit to jointly promoting cocoa consumption in local, regional and emerging markets;
8. Decide that the consultation between the two countries on the management of their cocoa sectors will be done on a regular basis.

DATED AT ABIDJAN, MARCH 26, 2018

HE ALASSANE OUATTARA PRESIDENT OF THE REPUBLIC OF COTE D’IVOIRE
HE Mr. NANA ADDO DANKWA AKUFO-ADDO PRESIDENT OF THE REPUBLIC OF GHANA

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