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Should Ivory Coast nationalize its cocoa industry?

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Now that Ivory Coast has rid itself of its criminal former president Laurent Gbagbo, Alassane Ouattara — the country’s new president — can get on with the task of governing this west African country, long known as an economic powerhouse. Ivory Coast’s world-class agricultural endowment is cocoa, and its farmers have historically produced the largest annual crop in the world.

Ten years of civil war, and electoral frustrations cost Ivory Coast its preeminent global position, which is now likely held by neighboring Ghana. In a well-reported article on the problems of Ivory Coast’s cocoa farmers, James North in The Nation argues that large European and American cocoa buyers, notably Cargill, ADM and the big Swiss firm, Barry Callebaut, are terribly “exploiting” Ivorian farmers. North, while admirably cataloging the abuses by brokers and dishonest middlemen in the cocoa value chain, proposes no solution to the problem, other than suggesting that Western consumers of chocolate ought to refuse to tolerate “this injustice,” implying that perhaps a consumer boycott would help.

Strangely, given North’s long history of reporting for left-wing and progressive journals, he makes no mention of a potential solution open to Ivory Coast’s government: the well-established practice, in Ghana, of having the state serve as the sole buyer and broker of Ghanaian cocoa. As the sole buyer, the Ghana Cocoa Board, an arm of the government, sets terms and prices for cocoa, and serves as a supplier of inputs and expertise for Ghana’s many cocoa farmers. Undoubtedly, the cocoa board penalizes some farmers because it pays prices well below the level of the world market. The Ghana government pockets the difference on the grounds that the nation should benefit as a whole from cocoa — and that farmers are receiving some benefits from a system that frees them from the Darwinian competition — dog eat dog — that James North insists undercuts and immiserates cocoa farmers in neighboring Ivory Coast.

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