Ghana - Cocoa Trade

Ghana - Cocoa Trade

1. Commodity Traders

   • Other cocoa traders
     • Ivory Coast
       • Supply TNCs as well
       • This puts downward pressure on prices
         • Commodity traders have alternative sources to negoiate with

2. Unequal Power

   • Ghana joined WTO in 1995
     • WTO imposed a joining condition
       • Ghanaian farmers should not be subsided
         • (Even though the USA and EU freely pay subsides to their own farmers)
         • Ghanaian farmers cannot compete with imported and subsides American or European foods
           • Some Ghanaian rice producers and tomato growers have give up altogether
     • Until then, its government had subsidsed Ghanaian farmers
       • Encouraged food production for its growing urban population

3. Overseas Tariffs

   • WTO rules seek tariff free international trade
     • EU sets tariffs for procesesd cocoa
       • None for raw cocoa bean
       • Extra income & Employment
         • By processing cocoa beans into powder
         • The value added would be higher
           • But tariffs would be applied on entry to EU
             • Driving up price for anyone who buys the product