ABSTRACT

The Cocoa sector contributes significantly to the economy of Ghana employing over a million people. The sector boasts of the sustenance of about six million people including marketing officers and purchasing clerks. Marketing officers and purchasing clerks constitute important individuals who act as agents of Licensed Buying Companies (LBCs). These licensed buying companies purchase cocoa bean from cocoa farmers through purchasing clerks and marketing officers to be sold to COCOBOD. Purchasing clerks and marketing officers have crucial roles to play since they serve as agents between LBCs and cocoa farmers. However, these agents face challenges such as inadequate logistics, low quality of cocoa beans and poor storage facilities which affect their livelihood.

The study employs the qualitative case study method. This method is essential to discover meanings that purchasing clerks and marketing officers ascribe to events they experience in the natural setting of the cocoa sector. The study investigates the challenges of purchasing clerks and marketing officers and how these challenges affect their livelihood. In doing so, the study locates meanings that these agents confer on the cocoa purchasing challenges and their impact on their livelihood.

The study identifies challenges of purchasing clerks and marketing officers to include inadequate logistics and low quality of cocoa beans purchased from farmers. The study mentions that additional challenges in the cocoa sector which undermine the roles of purchasing clerks and marketing officers and affect their livelihood include low margin payment to LBCs by COCOBOD and poor storage facilities to keep cocoa beans.

The study recommends that the government should increase the level of margins paid to LBCs. Besides, purchasing clerks and marketing officers must be equipped with the necessary logistics

to facilitate their work. Also, the study recommends that social programs should be organized for smallholder cocoa farmers to educate them on right practices of cultivation and storage of cocoa beans.

CHAPTER ONE

INTRODUCTION

The researcher in this chapter seek to profile a short history on cocoa sector of Ghana and the major changes that has taken place so many years ago. Followed by the problem statement, the aim of this thesis, objectives of this research, study significance, research questions, limitations of the study, and the organization of the chapters.

         Background of the Study

Cocoa (Theobroma cacao) production has become the mainstay of Ghana’s economy for more than 10 years now. Tetteh Quarshie introduced or brought the cocoa crops to Ghana (a pre- independence Ghanaian) far back in 1870 which today constitute one of the major export crops of the Ghanaian economy. Various administrations in the country including the colonial one extracted cocoa revenues as taxes to secure a significant share of government revenues (Rimmer, 1992). Kwame Nkrumah, the first president in power from 1957 to 1966, used cocoa reserves and revenues to promote an import substitution industrialization strategy (Killick, 2008). Subsequent governments in the late 1960s and in the 1970s continued in the footsteps of Nkrumah’s development policy, and retained a large role of the state in managing the sector for the benefits of the entire economy instead of switching to market oriented policies to access new sources of taxation (Killick, 2008).

The cocoa industry is paramount for the economies of many nations in African, where about 80% of the world cocoa is produced and millions of smallholder farmers produce the crop as a means to sustain their livelihoods (Fairtrade Foundation, 2011). Cocoa remains the vital agricultural export product of Ghana today (Barrientos & Asenso-Okyere, 2012). The Ghana’s cocoa sector

employs more than a million people throughout the country’s cocoa growing regions and remains the major source of livelihood for over six million people in the country (Tutu, 2009; Ghana Cocobod, 2010). Employer: In terms of job creation, the livelihood of about six million people (25% to 30% of the population) depends solely on the cocoa sector (Anthonio and Aikins, 2009). The cocoa sector contributes about 1/3 of all export incomes generated in Ghana accounting for between 25 to 30 percent of total export earnings and contributes about 10% to GDP (Anang, 2015). The cocoa industry in Ghana is heavily solely regulated by the COCOBOD, a government institute which sets the annual price for cocoa, determines who is allowed to purchase cocoa on the domestic market, organizes quality inspections, and provides inputs to farmers (Grossman- Green & Bayer, 2009: Capelle, 2008).

The following are the cocoa producing regions namely Ashanti, Greater Accra region, Brong- Ahafo region, Volta region, Western region and Eastern region (Barrientos & Asenso-Okyere, 2012). These are the most or main areas for cocoa farming due to their favourable tropical weather (Olesen et al. 2013). The Government of Ghana support the farmers with inputs in order to increase cocoa production consistently every year. The sudden decrease in poverty levels for cocoa producers coincides with a period of favorable cocoa prices, higher yields, and increased production. Cocoa producing households: Cocoa growing communities’ households, cocoa contributes for more than 67% of household income (Kolavalli and Vigneri, 2011). Apart from this there are numerous of issues affecting Ghanaian cocoa sector. Financial (poverty), ecological (pests and diseases) and social issues (child labour) are widespread (Hütz-Adams & Fountain, 2015: Wessel & Quint-Wessel, 2015).

In order recognized the contribution of cocoa to the development of Ghana, the government in 1947 established the Cocoa Marketing Board (CMB) of Ghana Cocoa Board (COCOBOD) has

the sole right of exporting cocoa. COCOBOD regulates or controls the cocoa sector in Ghana, with the aim of promoting cocoa production, processing, and marketing as efficiently and effectively as possible (Ghana Cocoa Board, 2012). Quality Control Company, the Cocoa Marketing Company, the Seed Production Unit and Cocoa Research Institute of Ghana are some of the various divisions that operate directly under the umbrella of COCOBOD. For example, the Seed Production Unit is responsible for multiplication and distribution of improved cocoa planting materials to farmers. Based on research and development by the Cocoa Research Institute of Ghana (CRIG), the SPU usually recommends the use of hybrid cocoa pods and materials (Ghana Cocoa Board, 2012). Cocoa production sometimes experiences setbacks due to factors related to government schemes, environment, and yield and stock features of trees (Dand, 1999).

To the European Union the main importers, Japan and the United States. This method was abolished in 1966 and licensed buying companies were reinvented to take over. Government founded Produce Buying Company (PBC) to be involved in the internal purchasing of cocoa beans from the producers of coca across all the cocoa growing regions in Ghana.

Years back 1984, as part of the Restructuring Program process, the board (by then renamed Cocobod) took a major downsizing exercise, which allowed the removal of tens of thousands of staff workers on payroll , and the elimination of non–essential roles such as building roads, processing cocoa and running plantations (Jacobeit, 1991). The Quality Control Division, renamed the Quality Control Company, remains responsible for ensuring that the overall quality of the beans is kept to the high standard, and the CMC remains the only exporter of Ghanaian cocoa.

For the various economic benefits that Ghana has again in the cocoa sector call for the need to investigate and assess the challenges confronting the sector in order to take corrective measures to address them to increase productivity and foreign proceeds for the country’s economy. This has

been the most ultimate reason why the researcher undertaking this study to investigate the challenges hindering the cocoa purchasing process in the Ghana’s Cocoa sector.