Summary
The EU sustainable cocoa initiative while welcome, needs to get to grips with the central issue of ensuring sustainable livelihoods which lift cocoa farming communities out of the endemic poverty which characterises the sector. If sustainability initiatives are launched which address environmental and child labour concerns in ways which place livelihood issues as an afterthought, then these are likely to be unsustainable, since it will not get the necessary farming community ‘buy-in’ required to finally put an end to both the use of child labour and unsustainable farming practices in the cocoa sector. Any such initiative needs to be rooted in financially incentivising through the market the production of child labour free and environmentally sustainable cocoa. This essentially has to address the issue of the distribution of revenues and costs along supply chains, with the existence of legally enforceable mechanisms to systematically remove non-compliant cocoa from European cocoa supply chains being a necessary complement to action in this core area.
On 22nd September 2020, the EC launched an initiative ‘to improve sustainability in the cocoa sector’ (1). This took the form of the convening of an initial EU multi-stakeholder dialogue on sustainable cocoa (2). This virtual event after an initial opening session addressed by the EU Commissioner for International Partnerships, Jutta Urpilainen, and the Ambassadors to the EU of Côte d’Ivoire and Ghana, focussed on two themes: the role of the EU private sector in the sustainability of cocoa supply chains and ‘improving synergies between the EU’s international cooperation programmes and other sustainability initiatives.’ This was followed by a wrapping up session which included an intervention by Heidi Hautala, Vice-President of the European Parliament and a long-term activist on child labour and sustainability issues in the cocoa sector (2).
The main aim of the dialogue process launched was stated as being ‘to guide the sector’s recovery from Covid-19, while also finding solutions to existing sustainability challenges.’ The focus is to be on developing ‘concrete recommendations on sustainable cocoa’ production and trade, with the focus being not only on ‘growth and profits, but also the social and environmental impact of our policies’ (1).
Jutta Urpilainen described the EC’s role as an ‘honest broker’ committed to creating ‘the foundation of a new international framework for sustainable cocoa’ (1). This needs to be seen in the context of the important trade partnership which the EU has with West African cocoa producers, with the EU taking fully 60% of West African cocoa production in a context where Cote d’Ivoire and Ghana account for 70% of global cocoa production (3).
In the coming 9 months a series of thematic groups will be convened to:
- ‘discuss ways to encourage responsible practices of EU businesses involved in cocoa supply chains’ (1), with the concept note having highlighted the need to address ‘due diligence practices, risk and contract management, purchasing practices, traceability, remediation, compliance with legislation, international guidelines, sustainability standards and reporting as well as related voluntary actions’, with possible sub-groups being convened to discuss issues related to ‘child labour, decent incomes for farmers and deforestation and forest degradation’ (3);
- ‘feed into other relevant ongoing Commission initiatives, including on due diligence and deforestation’;
- feed into the policy discussions between the EU and the involved cocoa producing countries: Côte d’Ivoire and Ghana;
- guide the European Commission in the design and deployment of support projects on sustainable cocoa production’ (1).
A plenary session is scheduled to be held in the autumn of 2021 to take stock of progress and issue a public report with recommendations on the future measures to be taken (1).
This dialogue initiative is seen as part of the EU’s ‘Green Deal’ agenda and its ‘zero tolerance approach to child labour.’ It is also claimed the dialogue seeks to build on the joint initiative of the Governments of Ghana and Cote d’Ivoire to promote ‘a minimum price for cocoa on the world market and the Living Income Differential’, designed to ‘ensure decent revenue for local farmers’ (1). Against this background the EC refers to the launch of ‘a policy dialogue with Côte d’Ivoire and Ghana to make sure that increase of prices is linked to actions halting deforestation and eliminating child labour in cocoa supply chains’ (1).
In the background concept note to the launch of the multi-stakeholder dialogue, reference is made to the importance of building upon ‘the initiative of the two main producing countries, Côte d’Ivoire and Ghana… on a minimum price for cocoa on the world market’, within any wider sustainability initiative. At this stage this focusses on the payment of a US$400/tonne premium ‘beyond the price of the cocoa future markets’.
As part of the current multi-stakeholder dialogue process it is envisaged ‘the EU Delegations in Ghana and Côte d’Ivoire will foster engagement at the local level’ (3). However, the question arises how well equipped are the EU delegations in supporting such processes?
The concept note suggests a need for a stock taking exercise in regard to: the main sustainability challenges faced; relevant existing initiatives which have been launched by the EU and member states in Ghana and Cote d’Ivoire; and existing due diligence requirements.
It is suggested the work of the multi-stakeholder dialogue should focus on developing recommendations in regard to due diligence regulations, cooperation in partner countries between private sector and international organisations devoted to promoting sustainable cocoa supply chains and raising awareness among consumers of sustainability initiatives.
Significantly in the concept note the multi-stakeholder dialogue process is seen as feeding into:
- ‘the implementation of trade and sustainable development aspects’ of the existing EPAs;
- the formulation of forthcoming international cooperation programming, including in close association with EU member states initiatives and international organisations;
- ‘possible horizontal mandatory legislation on corporate governance encompassing due diligence at EU level’;
- ‘a planned legislative proposal to minimise the risk of deforestation associated to products placed on the EU market (4); and
- relevant initiatives under the EU Circular Economy Action Plan (CEAP) (5) such as: ‘the development of legislation on green claims’, and ‘transparency initiatives under the Farm to Fork (F2F) Communication’.
This is heavily focussed on the domestic European policy and legislative agenda; with the danger existing that this will come to overshadow locally essential interventions and initiatives.
| Comment and Analysis The significance of the livelihood dimension in promoting both more environmentally sustainable farming practices and the ending of the use of child labour in the cocoa sector cannot be under-estimated. According to the EC’s press release, ‘up to six million farmers in Côte d’Ivoire and Ghana’ are directly involved in cocoa production, while a further 50 million people indirectly gain their livelihoods from the cocoa sector (1). A strong case can be made that ensuring a sustainable livelihood to cocoa producers, needs to be the foundation of addressing other sustainability concerns, which range from deforestation and environmental sustainability concerns to child labour and wider labour rights concerns. Adopting an approach which seeks to address environmental sustainability and child labour concerns in ways which place livelihood issues as an afterthought, is simply not sustainable, since it will not get the farming community ‘buy-in’ required to finally end both the use of child labour and unsustainable farming practices in the cocoa sector. This requires an initiative which not only builds on the recent ‘living income differential’ proposal by guaranteeing a decent net income for all Ghanaian cocoa farmers, but also an initiative which addresses the distribution along the whole of the supply chain of the costs of specific measures to guarantee compliance with a sustainable production charter. This needs to extend to the prices paid for sustainably produced cocoa products by end consumers. On this basis European development assistance can then be mobilised to support government supervision of locally rooted farming community supported compliance mechanisms. This should then be coordinated with a carefully modulated approach to the phasing in of legally enforceable due diligence requirements. The emphasis needs to be on financially incentivising through the market the production of child labour free and environmentally sustainable cocoa, while having available legally enforceable mechanisms to systematically remove non-compliant cocoa from European cocoa supply chains. Only by the adoption of an approach which places the emphasis on financially incentivising the necessary actions at the local level can any European initiative on sustainable cocoa production hope to yield results within the necessary timeframe for such actions to have an impact on mitigating climate change Against this background, it is noteworthy that despite the emphasis placed on ensuring sustainable livelihood issues are central to any wider cocoa sustainability initiative, only 1 of the 9 speakers in the substantive sessions at the launch of the Sustainable Cocoa Initiative, provided the view of African cocoa producers. Inviting African representatives to participate in opening sessions can, be no substitute for active and effective African involvement in the substantive discussions on what needs to happen within supply chains to effectively promote child labour free and more environmentally sustainable forms of cocoa production, fully supported by cocoa farming communities themselves. The challenge faced is how to achieve such effective African cocoa producer engagement in an era of Covid-19 travel restrictions and social distancing requirements given the age structure of the cocoa farming community and the day to day poverty related challenges which are faced in cocoa farming communities? It would appear as if priority needs to be accorded to supporting in country tripartite dialogues between government, cocoa farmers organisations and industrial processers on what needs to be done to guarantee a net living wage for cocoa farmers and address the core sustainability issues of deforestation, the environmental effects of production and processing, child labour and wider labour rights. Only on such solid foundations can European due diligence regulations have any change of bringing meaningful and sustainable changes in the cocoa sector. |
Sources:
(1) EC, ‘Commission launches initiative for more sustainable cocoa production’, 22 September 2020
https://ec.europa.eu/international-partnerships/news/commission-launches-initiative-more-sustainable-cocoa-production_nl
(2) EC, Sustainable Cocoa Initiative, ‘Agenda EU multi-stakeholder dialogue for sustainable cocoa, Launch event’, 22 September 2020
https://ec.europa.eu/international-partnerships/system/files/agenda_launch_event_eu_multistakeholder_cocoa_dialogue.pdf
(3) EC, Sustainable Cocoa Initiative, ‘EU multi-stakeholder dialogue for sustainable cocoa; Concept Note’, 1 September 2020
https://ec.europa.eu/international-partnerships/system/files/2020901_eu_multistakeholder_dialoguepublic_final_with_banner.pdf
(4) EC, ‘Deforestation and forest degradation – reducing the impact of products placed on the EU market’
https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/12137-Minimising-the-risk-of-deforestation-and-forest-degradation-associated-with-products-placed-on-the-EU-market
(5) EC, ‘Circular Economy Action Plan: For a cleaner and more competitive Europe’, 3 April 2020
https://ec.europa.eu/environment/circular-economy/pdf/new_circular_economy_action_plan.pdf