News in Brief:
– The World Bank has pledged to support Ghana in revitalising its struggling cocoa sector, which struggles with declining yields, low farmer incomes, and environmental degradation.
– The Ghanaian government is also taking steps to address these issues, including establishing agro-industrial zones and providing support to farmers.
The World Bank has expressed its commitment to assisting Ghana in reviving its ailing cocoa sector.
During a meeting with President John Dramani Mahama, World Bank Vice President for West and Central Africa, Ousmane Diagana, acknowledged the significant challenges facing the industry while emphasising the sector’s substantial untapped potential.
Effectively, Diagana indicated that the World Bank has developed recommendations to address these challenges, drawing upon existing programs in Ghana. Also, he stated that the recommendations will be further discussed with the Ghanaian government to determine how best to integrate them into existing development initiatives.
Ghana’s cocoa sector: a global giant facing challenges
Ghana is the second-largest producer of cocoa beans globally, after Côte d’Ivoire. This vital sector contributes significantly to the Ghanaian economy, generating an estimated 2.25 billion Ghanaian Cedis (approximately US$390 million) in 2021.
However, it has been experiencing a decline, contracting for the fifth consecutive quarter in the third quarter of 2024. This sharp downturn, amounting to a 26% contraction, stands in stark contrast to the overall economic growth of 7.2% during the same period.
The cocoa sector’s challenges, which began in late 2023, have steadily worsened throughout 2024. This prolonged crisis threatens the livelihoods of millions of Ghanaians who rely on the cocoa sector for their income and poses a significant risk to the country’s foreign exchange earnings.
Key challenges plaguing the Ghanaian cocoa sector
- Declining Yields: Aging trees, pests and diseases, and the impacts of climate change are significantly impacting cocoa production.
- Low Farmer Incomes: Many cocoa farmers struggle with poverty due to low prices for their beans and the high cost of inputs.
- Environmental Degradation: Intensive farming practices can lead to deforestation, soil erosion, and water pollution.
- Child Labour: Despite efforts to combat it, child labour remains a significant issue within parts of the cocoa supply chain.
Government initiatives to revitalise the sector
Analysts opine that this prolonged downturn underscores the urgent need for sustainable solutions to revitalise the Ghanaian cocoa sector.
Therefore, the World Bank’s support, combined with the Ghanaian government’s efforts to address these challenges, is seen as crucial for ensuring the long-term sustainability of this vital industry.
Meanwhile, President John Dramani Mahama, who was recently re-elected to a non-consecutive second term on December 7th and is himself a farmer, has vowed to improve the agricultural fortunes of the nation.
Mahama, who pledged to make Ghana food secure during his campaigns, stated that his administration would establish special agro-industrial zones in all sixteen regions in the country. He added that his government will set up farmer service centres nationwide to provide farmers with technology, equipment, and inputs to improve food security and drive economic growth.
