Politics, power and unfair market concentration in the cocoa global value chain (GVC): analysing the prospects of the living income differential (LID) for achieving a just and sustainable livelihood for cocoa farmers in Ghana

Abstract

Ghanaian cocoa farmers confront many social and economic challenges and are unable to pursue needed farm improvements because of insufficient and dwindling income. The income of farmers is too low for them to generate enough capital to invest in improvements in productivity or even more sustainable ecological practices. While various initiatives exist aimed at eradicating the problem of child labour, promoting better farming methods and ensuring access to agricultural inputs like fertilizer, sustainable credit and financing, often overlooked is the centrality of guaranteeing a viable minimum price for cocoa farmers, their families and workers, upon which other sustainable achievements in the cocoa industry ultimately hinge. A guaranteed minimum price can play a key role in combating the vicious cycle of poverty and social injustice by providing farmers with a living income. Having a guaranteed minimum price can create a more stable social and economic environment in which cocoa farmers can have the confidence to invest in their farms, including the necessary and costly replanting of cocoa trees. Cocoa farming cannot be considered fair, ethical or sustainable if it cannot provide a living income to the millions of hardworking farmers and workers in Ghana. I will argue that the decision by the Government of Ghana to initiate a guaranteed minimum price of $400 premium per tonne for cocoa is the most efficient and simplest way to address insufficient income among cocoa farmers in the long term.