Last week, the committee that has taken over the management of the cocoa sector in the Côte d’Ivoire took a first step toward reform. The committee decided to lower the one of the cocoa levies from CFA25.26 to CFA 10.06 per kilo. The proceeds of that levy were used to fund the three cocoa agencies at the center of the corruption scandal.
This decision represents an important step in drying up the pool of money that led to the corruption in the first place. But, and there is always a but, the decision also begs a new question. Originally, the funds collected through this levy were supposed to benefit farmers through extension services, support for fertilizers and pesticides. We know now that most of the money never made it that far. But how else can farmer support be finances.
The export tax of CFA 220 remains in place, as does the port registration tax (10% of the value of exported cocoa). But those taxes are considered general revenue rather than sector specific revenue. It will take political will to use the general budget process to create allocations for such cocoa farmer services. With elections in the near future, I doubt we will see any significant new initiatives soon.
- October is Fair Trade Month!
- Fair Trade Counters Poverty