From: wsargeant@IGC.ORG (Winslow L. Sargeant)
Newsgroups: soc.culture.african
Subject: IPS:Ghana, cocoa farmers question wisdo'
Date: 7 Apr 92 16:52:02 GMT
Article-I.D.: cdp.9204071652.AA12017

/* Written  9:03 am  Apr  7, 1992 by newsdesk in cdp:ips.englibrary */
/* ---------- "GHANA: COCOA FARMERS QUESTION WISDO" ---------- */
Copyright Inter Press Service 1992, all rights reserved.  Permission to re-
print within 7 days of original date only with permission from 'newsdesk'.

Reference: Africa, west; Agriculture
Title: GHANA: COCOA FARMERS QUESTION WISDOM OF NEW FREEMARKET MEASURE


an inter press service feature

by ruby ofori

accra, apr 4 (ips) -- expectations of healthy competition, cost
savings and increases in cocoa farmers' incomes with the
liberalisation of the domestic cocoa marketing in ghana may be
wrong.

john asamoa, spokesperson of the cocoa coffee and sheanut
farmers association, says his members fear a return to the bad
old days before this west african state took over cocoa
marketing.

in those days, he points out, cocoa producers were
''cheated'' by the private multinational subsidiaries like
cadbury, united africa company and g.b. ollivant which bought
the cocoa, one of ghana's leading exports.

the government mar. 20 announced that private firms would be
allowed to buy cocoa from farmers to sell to the state-run cocoa
marketing company. this ended the buying monopoly role of the
produce buying company (pbc), ghana's largest state-run
enterprise.

asamoa says farmers believe private firms will not be able to
make regular and timely purchases of cocoa because the costs are
just too high for individual concerns to bear. a tonne of cocoa
costs around 250 million cedis.

in some cocoa-growing areas, farmers would be stuck with
stock. eventually, the farmers would switch, in frustraiton, to
food crops such as cassava and maize, and cocoa production would
decline.

farmers had a welfare system whereby the price of one kg of
cocoa from every bag would be invested in a communal fund, used
to pay salaries of the executive of the farmers' association and
pre-finance insecticides and other inputs.

in every district farmers' societies had a passbook in which
they would tally their contributions to the fund. in this way,
they could get credit to make improvements. other communities
used their money on social needs such as schools and clinics.

now farmers are unsure whether private buyers will keep the
system of kilogramme deductions. they are also unsure if the
association will have as a good a working relationship with the
newcomers as it did with the pbc. (more/ips)


ghana: cocoa (2)

atiemo, however, assures the 500,000 cocoa growers that their
interests would be protected. ''farmers won't lose in terms of
any bonus,'' he says.

the pbc would continue to operate and a minimum price would
be set by agreement between farmers, dealers and the cocoa
marketing company.

there would be no drastic changes overnight. the pbc
would continue to operate while new applicants entered the
field. ''we don't imagine there will be very many initially,''
says atiemo.

''the amount of capital one needs to buy one tonne of cocoa
is very great, 251 million cedis (about 700,000 dollars) at the
current produce price levels,'' atiemo adds.

for those who will be able to afford it, cocoa buying can be
big business, at least in ghanaian terms. between 1990/91, the
pbc's turnover was 650 million cedis (about 1.8 million
dollars), atiemo explains.

responding to the cocoa farmers' criticisms, a senior
official of the ghana cocobod, flt lt joseph atiemo, says there
are stringent guidelines to protect cocoa quality and ensure
that only very well-organised firms are granted licences.

the overall objectives of liberalisation are to improve
efficiency, rationalise costs, and increase producer prices,
says atiemo.

''through private initiative certain overheads will not be
there any more and can be translated into improved producer
prices,'' he explains. ''the sheer force of competition will
force enterprises to operate at a higher level of efficiency.''

up until 1961 foreign firms dominated cocoa purchases in
ghana. under the socialist government of president kwame nkrumah
(1957-1966), this role was transferred to a farmers' cooperative
until his government was overthrown in 1966.

between 1966 and 1977 indigenous entrepreneurs held the field
of buying cocoa. but they required financial assistance from the
state because they lacked capital of their own and the banks
were not willing to lend to them.

that system also failed. by 1977 all these changes had led to
declining quality of cocoa in that year. for the first time, the
produce buying division of the cocoa administration was set up
to buy the crop.

as sole buyer, the state, in cooperation with farmers, set
about increasing production and improving quality. overall
producer prices were increased and farmers who did well were
given bonuses of cloth and subsidies on insectides.
(end/ips/ro/apc/ar/92)