Fourth Quarter, 2005

 The Ivorian cocoa farmer is poorer now than the hey-days of the 60s and 70s, when cocoa prices were high, the French government was making up for Ivorian deficits, and Ivorians were encouraged to grab land, cut down forests and plant, plant, plant.  Today, Ivory Coast is the world’s largest grower of cocoa (43%)  the fourth largest grower of coffee, and a major producer of palm oil for the European market.  Seventy-five percent of the cocoa beans used to make American chocolate have been harvested in Ivory Coast.

In Ivory Coast’s hey-day, large-scale cocoa farmers made enough money to send their children to universities and small-scale farmers could at the very least provide them with a few years of elementary school.  Chocolate confections in Europe and the United States were affordable for everyone.  Since those days, various events have driven down the price of cocoa  or have siphoned away profits from the farmer, leading to their progressive impoverishment.   Meanwhile, Europeans and Americans continue to enjoy affordable chocolate confections. The economic situation of the cocoa farmer has become so dire that some farmers are quitting the business and their children are moving to cities.  Other farmers have resorted to using child slave labor because they cannot afford to pay wages, a situation that was described in a series of videos and articles by members of the British press in 2000.  This situation was to have been addressed by the Harkin-Engel Protocol (see http://www.globalexchange.org/update/press/3227.html), a system of certification to assure American and European consumers that their chocolate does not contain cocoa beans that involve any of a list of child labor abuses.  The main chocolate manufacturers on both sides of the Atlantic formed organizations to address the problems, but after 5 years, little progress has been made, and the protocol was recently granted a three-year extension.

If you have been to Ivory Coast and you have tromped through the cocoa farms, talking to farmers, middlemen, and buyers,  learning each perspective, you quickly realize that the protocol is probably not going to work.  At least, it won’t help the farmer.  It might assuage a few guilty consciences in North America and Europe.  The country is just too big, there are too many farmers, too many children getting no education, and too much governmental chaos.  You begin to suspect that the chocolate industry, especially the American companies, are playing for time and are hedging their bets by encouraging Vietnam and Indonesia to cut down their forests.  Supporting this hypothesis is the donations area of the World Cocoa Foundation’s web site (http://www.worldcocoafoundation.org/About/donate.asp);  in it,  suggestions are made about donating money to help Vietnam and Indonesia, while no mention is made of Ivory Coast, even though it exemplifies the most severe labor problems and it is, by far, the world’s largest producer of cocoa.

Meanwhile, the Ivorian cocoa farmer continues to suffer.  Today, out of a recommended 750 CFA FOB price for fermented dried cocoa, 308 CFA go to the government in taxes.  In the early 90s, as French governmental support dwindled, world cocoa prices dropped, and Ivory Coast’s loans became difficult to repay, the World Bank requested--in exchange for forgiving payments--that the Ivorian government disband its Caisse de Stabilization, a fund used to ensure that farmers receive a consistent price for their cocoa despite cocoa price or currency fluctuations.   Historically, the World Bank has euphemistically referred to such programs as structured adjustment.  Ironically, the World Bank’s economists eat and dine well while pushing for “transparency” and “free trade”, using  programs that in the name of bringing a country’s economy in line with international norms, cut the little people to the quick, depriving them of a living wage with which they can educate their children.

Besides the World Bank, which is controlled by the United States, American and European governments are guilty of looking after the interests of American and European farmers to the exclusion of Third World farmers, who are no longer able to compete on the world market.  American and European governments, which piously tout free trade, engage in the crassest forms of anti-competitive dumping.  The name of the game is “subsidy,”  and there are numerous examples of it.  Just picking one country that has suffered from decisions made in Washington and Brussels:  Mali.  Located just to the north of Ivory Coast, its farmers grow cotton and produce milk.  However, with the world price of cotton depressed by American subsidies ($4 billion annually), the Malian farmers can no longer sell their cotton competitively.  The same is true of milk.  Every French cow is subsidized at the rate of $2 per day, and the French government, ever mindful of the welfare of its former colonies, dumps powdered milk in Mali, forcing farmers out of business.  The result, in Mali, one of the 5 poorest countries in the world, is a migration of children south to the cocoa fields of Ivory coast, where those children pick the cocoa beans for American and European chocolate.  One could argue, credibly, that this is a sort of neo-slave triangle.  Or perhaps parallelogram.

As with any political or economic situation, the causes and solutions are complex.   The fault does not solely rest with the Bank or with Western governments.  There are other reasons for the poverty of the cocoa farmer.  In the early 1980s, fires induced by global warming caused the burning of vast tracts of forest in West Africa.  Many farmers lost their plantings and were no longer able to afford to purchase vehicles to move their agricultural products to market.  In the same period of time, the immigration of  Lebanese from war-torn Beirut strengthened the traitant system, whereby Lebanese purchased warehouses and formed relationships with the large cocoa buyers, acting as middlemen between buyers and farmers.  The Lebanese moved their families into large towns in the cocoa-growing regions--e.g., Daloa and Gagnoa.  However, they were not familiar with local customs, village life, etc. so another layer of middlemen formed--the pisteurs.  Typically  Ivorian, Malian, or Burkinabe, the pisteurs are experts at negotiation, judging human character,  sensitive to local power issues, and unafraid of the myriad military barricades that impede commercial traffic.  The result is an additional two layers of middlemen who have the capital to purchase scales and  are able to read and write as well,  are in a position of local price-fixing, collaborating with each other, renting tricked scales to farmers, inflating shipping costs, and any number of other schemes.  The knowledge that such individuals have such power grates on farmers who in the end trust nobody.

There are over 1500 cooperatives in Ivory Coast.  Because of the laissez-faire commercial atmosphere engendered by the hands-off attitudes of the government, these cooperatives are not always working in the interests of the farmers.  Judging from comments of farmers interviewed by this author, it’s six-of-one-half-dozen-of-another when it comes to selling cocoa beans.  You are just as likely to be ripped off by a pisteur as by the buying agent of a cooperative.

The political and military situation in Ivory Coast also weighs heavily on the cocoa farmer.  In 2002, the country split into two halves, the northern half being primarily Muslim and the southern half being primarily Christian.  A  state of impending war continues to this day and, as the wife of one traitant put it to this researcher, “I was born in Côte d’Ivoire in 1932 and today, I live with two bags packed, ready to leave at a moment’s notice.”   To fund a a state of readiness for war,  the Ivorian government taxes all agricultural products, and cocoa is a prime target.  As their standard of living has declined, cocoa-growing families have seen their children move to the big cities and they have been forced to hire labor.  Some farmers have been forced to sell off traditional family lands, often to allogenes or non-Ivorians.  This causes the size of the family farm to shrink and the economic viability of the cocoa farm to shrink as well.  With a dwindling federal budget, Ivory Coast is hard-pressed to support agricultural programs.  As a result,  cocoa trees are aging and their yields are diminishing.

Large chocolate companies have done comparatively little to address such problems.  They are owned by Western corporations  that have, for one reason or another, developed a hands-off relationship with local government and local farmers.  Cargill, Archer Daniels Midland, and Nestlé have facilities in Ivory Coast, but they operate behind their fences and walls, relying mostly on local pisteurs and traitants to bring them the beans.  

The author can think of three notable exceptions.  One is the Swiss-owned firm of Barry-Callebaut, which has set up a pricing structure with 60 Ivorian cooperatives to base prices on quality.  In addition, Barry-Callebaut has a cocoa bean sorting facility in the north central portion of the cocoa belt;  the company shares the profits from that operation with local cooperatives.  These sorts of efforts show a commitment by the company to work with local people and to engage in efforts to improve their financial welfare.   A second exception is in neighboring Ghana, where Cadbury has embarked on several projects to improve quality of life as well as the quality of the cocoa bean itself.  Cadbury donates money to build wells in villages, has funded environmentally sensitive ecotourism projects, and supports research into developing a better cocoa bean for the local area.  A third exception, again in Ghana, is Kuapa Kokoo, the world’s largest cocoa cooperative.  Farmers belonging to this cooperative are also 30% owners of a British chocolate company, Day Chocolate Company, which produces exclusively Fair Trade chocoolate.  Recently, Catholic Relief Services has launched a promotional campaign to assist sales of Divine chocolate, a Fair Trade chocolate bar produced by the Day Chocolate Company (http://salt.claretianpubs.org/sjnews/2005/11/sjn0511a.html).

Adoption of such relationships by American companies would help to combat poverty in the cocoa-growing areas of Ivory Coast by adding value for a bean that is properly grown, fermented, and dried.  It is perhaps no coincidence that  American companies such as Archer Daniels Midland and Cargill, interested mostly in the cheapest possible cocoa bean, contribute nothing toward improvement of the commodity whereas the European company, working with locals to improve quality, fosters a closer commercial relationship with the local growers and a feeling of cooperation.

Since 2000, there has been growing concern over working conditions in the cocoa fields.  Various journalists have documented instances of child slavery, and studies have shown a disturbing trend toward increasing reliance on child labor at the expense of providing children with an education.  In July of 2005, the International Labor Rights Fund filed suit in U.S. District Court against Nestlé, Cargill, and Archer Daniels Midland for knowingly trafficking in a substance (cocoa) produced with child slave labor (http://www.glendalenewspress.com/business/story/19017p-26765c.html;  http://www.timesleader.com/mld/timesleader/business/12134495.htm?template=contentModules/printstory.jsp)

In August, 2001,  Senator Tom Harkin and Representative Eliot Engel wrote and passed the Harkins-Engel Protocol in conjunction with chocolate industry groups and child labor groups.  This protocol was designed to implement a system of certification ensuring that the European and American consumer could eat their chocolate guilt-free.  In July, 2005, because of inadequate action by the industry groups, three years were added to the deadline.

In the estimation of this researcher, it is unlikely that a system of certification will work.  First, little effort has been expended toward organizing or creating a system of accountability.  Second, such a system is akin to treating cancer with aspirin.  One feels good temporarily, but the underlying illness, in this case poverty and structuural problems with the industry remain untreated.

The World Cocoa Foundation and the International Cocoa Initiative have established farmers’ field schools, designed to inform Ivorian farmers about the impending protocol.  These are temporary and do not  treat the underlying cause of child labor abuse, which is poverty caused by years of neglect by the Ivorian government, the World Bank, and certain chocolate corporations.

Frustrated with the shallow responses of politicians and chocolate industry groups, this researcher established along with Ernie Roide of Promotion Plus, Inc. of San Luis Obispo and Eric Parkinson, a local attorney, the  foundation,  Project Hope and Fairness.  Our intentions are to treat the illness of poverty rather than merely to certify chocolate as “abusive child labor free.”  While we cannot change the current political and military situation in Ivory Coast, we can lobby  American chocolate companies to become more involved in the field;  we can point to companies like Barry-Callebaut and Cadbury that, on their own, are making positive contributions to the local economy.  We can provide alternatives to field classes, working at the behavioral and affective levels instead of the merely cognitive.  In our view of the situation, the farmer would be better served by being provided tools to dig him- or herself out of poverty. 

We recognize that distributing in-kind gifts is not easy;  much harder than running field schools.  Typically, a lot of money will be spent just getting the tools from the merchant to the field.  But when you walk through a West African cocoa-growing village and you realize that they have no electricity, no running water, no sewage, no schools, no easy foot paths, no transportation, no tools other than old machetes, you realize how much they would benefit from real material goods in addition to information about labor issues, new farming methods, and varieties of cocoa.

This document details an initial experimental treatment of the illness of poverty.  We delivered three cocoa scales to three villages.  Our Director of Operations in Côte d’Ivoire, Evariste Plegnon, purchased the scales in Abidjan from a Lebanese merchant, borrowed his truck and driver, bought the services of two security officers, and drove the scales to the villages of Zereguhé, Depa, and Bateguedea.  This experiment is a longitudinal study of farmers’ reactions to the scales, of how villages ensure that the scales are used properly, determination of who benefits from the scales, and how access to them is controled.  This information will be gathered by the researcher who visits the villages every summer.

The West African village is a sociopolitical entity that is functional.  When visitors come from the outside, certain individuals are responsible for greeting them.  When the pisteur or buyer comes to the village, everyone knows who is reponsible for negotiating prices and delivery times.  Some villages have old scales.  Others rent scales.  But as you will see from comments in this document, the scale is a powerful tool for improving the economic lot of the cocoa farmer.

Thus, when Evariste, our Operations Manager, delivered three scales to three villages, the response was predictable and consistent:  a universal feeling of euphoria and thankfulness.   People moved the scales around from house to house, and everyone got a chance to weigh him or herself as well as the children. 

Our idea is to provide thousands of such scales.  There are over 600,000 cocoa farms in the  Ivory Coast, and many of them are connected  to villages or to campements or hamlets.  Thus, one concern--whether a scale donated to farmers might languish for want of people who understand weight--appears to not be a problem.  As demonstrated in the three villages, Depa, Bateguedea, and Zereguhé, the villages were already in the habit of renting scales.  Also as demonstrated by Evariste’s interviews, the village divides naturally into the chief, the women farmers, and the young farmers.  In all three cases, the young farmers took it upon themselves to form committees to teach people how to use the scales.

One comment that may prove to be prophetic is the concern over equity.  Since everyone consistently owns nothing,  and since now three villages have scales whereas surrounding villages do not have scales, a certain amount of jealousy may develop.  Time will tell.

One can only be moved by the responses of the villagers to this gift.  One might suspect that their response is not proportionate to the size and value of the scale but more to the notion that someone who passed through for a couple of hours actually would give them something like this and that someone in another part of the world might care about them.  The scale becomes a powerful symbol of love.

A note of thanks to Evariste, Director of Operations for Ivory Coast, who has proven to be reliable and creative in his dealings with the police, the paramilitary groups, the military, and others.  We are very pleased that our first efforts were so well received, and we are also very happy with the plethora of pictures and interviews that help potential donors understand the situation and learn something about Ivorians.