CNN’s Freedom Project: Prosperity Lessons for Nigeria

By Kenneth Tadaferua

The CNN’s Freedom Project, a CNN media campaign launched in 2011 to end modern day slavery, human trafficking and other related illegal practices is providing amazing expose on the evils of criminal enterprise around the world. Its declaration that: “There are more slaves today than at any point in human history” is shocking and true.

Its recent spotlight on child labour, slavery and poverty in the cocoa industry is another milestone documentary. But much more than the child labour story, the documentary tells the grim impact of the inequitable structure of global trade that has Africa as an unfortunate victim.

The demand for cocoa is growing. Global chocolate industry is flourishing. The industry is worth an estimated $110 billion annually. Yet the rural farmers who grow the cocoa from which chocolate is made are among the poorest peoples in the world.

Welcome to West Africa the region that supplies two thirds of the world’s cocoa beans. Zoom in on Ivory Coast, the world’s largest supplier of the cocoa crop at 1.22 million tonnes. It has been estimated that about 800,000 children labour in cocoa plantations across the country. The 2013 budget of Ivory Coast is $7.8 billion. The 2012 total sales of Nestle, one of the giant companies trading in chocolate is $100.30 billion with net profit of $11.55 billion. Do the math. It must be noted though that Nestle operates 468 factories in 86 countries.

Africa, which merely plants and exports cash crops, as the documentary shows, is at the wrong end of the production chain, which includes traders, processers, exporters, researchers, manufacturers and marketers. International prices of cash crops are not only low but also falling. Adjusting for inflation, the price of a tonne of cocoa beans was some $6000 in 1980 but it is about $2,400 today. A more than 50 percent drop.

Indeed, Richard Quest who reported and anchored the documentary from Ivory Coast noted that the farmers have never seen let alone taste the chocolate, which rely on their daily toil. He adds: “It is a supreme irony that the chocolate, we all take for granted, at the price we don’t mind paying, is rarely seen in the Ivory Coast, not even in the capital.”

The consequence of such poor international price is disillusionment and deepening poverty for the rural farmers. Many farmers are unable to tend to their cocoa trees and farms. The young strong ones among them are moving in droves to the capital cities of Yamoussoukro and Abidjan. The cocoa farms are aging and in decline.

It is the same story across Africa – the neglect of the bottom end (rural farmers) of the value chain by local policy makers and the international trade system. Nigerian rural farmers today form the bulk of the dirt poor that make up more than 50 per cent of the country’s population. Yet Nigeria has no clear policy on how to save this teaming population of the wretched and the disillusioned from grinding poverty

But in the two years since CNN exposed the use of child labour in the cocoa industry, positive developments have emerged in Ivory Coast. Companies in the cocoa supply chain, NGOs and the government of Ivory Coast led by Daniel Duncan, have pledged to stop children working on the plantations, send them to schools and improve the lives of the rural cocoa farmers.

Driven by economic self-interest to ensure sustainable cocoa beans supply for their business, cocoa multinationals like Nestle are moving to invest in those at the bottom of the value chain. They now support better earnings for rural farmers, build schools for farmers’ children, provide improved, high yield and disease resistant cocoa seedlings. The new government of Ivory Coast is working with the international companies to encourage investments in the local cocoa trade while boosting the earnings and capacity of the farmers.

The CNN reports that reform in the cocoa business now guarantees steady price for the farmers at $1.5 per kilo at the farm gate. This fixed minimum price is some 60 percent of the international market price for the cocoa beans. The advantage for the rural farmers is that they can now budget ahead and are less at the mercy of middlemen. They have steady income to boost work and productivity on their farms.

To boost the capacity of the farmers, they are being organized into cooperatives to stop child labour and importantly, to establish certification that will drive production of better yield and protect their crops from diseases with better quality. Farmers that meet the standards of the certification get higher market price and bonus for their cocoa beans.

Perhaps the Ivory Coast government will begin to look at the future of prosperity for the country by driving greater capacity involvement of the local people in the value added processes of the value chain in chocolate manufacturing. Companies like Nestle should be encouraged to produce chocolate in Ivory coast, after all the cost of production will be significantly lower as the export element of the chain will be eliminated.

What is significant in this story is that it is not exactly new. Nigeria, before the advent of the toxic power of petroleum, was a cash crop powerhouse. From cotton, groundnuts, timber, cocoa, rubber to palm produce, Nigeria was an emerging economy heavyweight that was way ahead of Brazil, Singapore and Malaysia. It was the time that Nigeria had produce boards that fixed minimum price of cash crops for rural farmers.

Then companies like African Timber and Plywood (AT&P), PAMOL, Dunlop among others not only worked with rural farmers but set up large farms. All the seaports from Port Harcourt, Calabar, Warri, Sapele, Koko and Lagos were in full operation. Today, all of those businesses and the prosperity they brought with them are dead. The rural farmers are neglected in policy-making and some wonder why poverty is deepening in Nigeria.

Nigeria must return to the starting blocks. We must go forward to the past. We must empower the rural farmers and start building value added and industrial capacity from there. The economics that talks about economy growing at six or seven percent because of the sale of crude oil which we do manufacture or the inflow of portfolio investors who fly away at the slightest hint of higher risks will not produce long term sustainable prosperity for Nigeria and indeed Africa.

Mr Tadaferua is the publisher,

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