Sub-Saharan Africa

Encouraging Profitable, Sustainable, Cocoa Growing

According to Bill Guyton, President of the World Cocoa Foundation, who visited IFC recently, cocoa is a potential economic engine in tropical rural areas, generating incomes and opportunities for farm families and communities. During his visit, Guyton highlighted the importance of providing cocoa farmers with the knowledge, training, and assistance they need to move from subsistence farming to a truly sustainable model that allows them to succeed and prosper.  

“One of the main challenges we have is how to reach the small farmers who grow the crop,” said Guyton, referring to the more than five million family farms in countries like Brazil, Cameroon, Cote d'Ivoire, and Vietnam, which produce about three million tons of cocoa beans each year. “Productivity in these farms is relatively low,” he added.

IFC is working with the World Cocoa Foundation, whose member companies represent 80 percent of the global cocoa market, to increase access to finance and productivity for farmers in West Africa where 70 percent of cocoa beans are produced. This support is crucial for a sector where only 90 percent of cocoa comes from smallholder farms that often lack resources for basic supplies. 

Nestle and Mars, two cocoa giants, have made public statements about moving to 100 percent sustainable cocoa by 2015 and 2020, respectively. These are just examples of a major industry trend. If achieved, these goals will have a major positive impact on the more than five million farm families in Africa, Southeast Asia, and the Americas that grow and depend on cocoa for their livelihood.

However, to reach sustainable production and trade, much work is needed in an industry where harmful child labor, low farming productivity, and environmentally damaging practices are still major issues. IFC is partnering with the industry to help make it happen.

IFC's collaborative initiative also provides farmers with technical skills to make production sustainable, addressing climate change and benefiting from an increasing global demand for products made under sustainable practices. 

IFC is also working with global commodity traders and supply chain integrators such as Armajaro Trading and ECOM to enhance the sustainability and traceability of cocoa and improve the livelihood of farmers, explained German Vegarra, Global Head, Agribusiness and Forestry, Global Manufacturing, Agribusiness and Services department. In FY2012, IFC invested $107 million in companies working in this industry.