The Missing Link in Nigeria’s Cocoa Value Chain, by Ibim Banigo and Raphaël de Perlinghi

The Missing Link in Nigeria’s Cocoa Value Chain

By Ibim Banigo and Raphaël de Perlinghi

How the Abuja Declaration and the BoI–EIB facility can turn an export crop into an industrial economy

Every bag of cocoa that leaves Nigeria as an unprocessed bean carries two values. The first is recorded at the port. The second, and much larger, is created later through grinding, pressing, ingredient manufacture, confectionery, branding and retail. Most of that value is still realised elsewhere.

Nigeria produces more than 300,000 tonnes of cocoa a year but processes only about 50,000 tonnes. It grows the raw material for cocoa powder and still imports cocoa powder. This is not a shortage of cocoa. It is the consequence of an unfinished industrial system: farms poorly connected to patient capital, processors uncertain of reliable supplies, lenders without dependable production data, and exporters increasingly required to prove where their beans were grown and how they entered the supply chain.

The Abuja Declaration on Cocoa Value Addition offers an opportunity to repair that system. Adopted by Nigeria, Ghana, Côte d’Ivoire and Cameroon, it seeks to expand processing in producer countries, improve farmers’ earnings and give African states greater influence over the trade built upon their crop. The Nigeria Cocoa Value Addition Accord brings that ambition home by joining government, producing states, farmers, processors, researchers and development finance institutions in a common enterprise.

The distinction is telling. The Abuja Declaration provides a regional direction; the national Accord must assign responsibility and measure delivery within Nigeria. The €85 million agricultural value-chain facility agreed between the Bank of Industry and the European Investment…