Service delivery SMEs boost cocoa production in West Africa

Over the last five years, Solidaridad West Africa has supported the establishment of small and medium enterprises (SMEs) to deliver services that address poor farm management, high costs of labour and inputs, as well as inadequate financial and agricultural extension services in cocoa production.

With an overall strategy of providing access to finance for implementing sustainable service delivery models,  the second phase of the Cocoa Rehabilitation and Intensification Programme has supported young entrepreneurs to set up and operate 222 profitable and investment-ready service centres. 

These centres provide improved planting materials, agrochemicals, crop protection, rehabilitation, financial and extension support to hard-to-reach smallholders in cocoa-growing communities in Cote d’Ivoire, Ghana, Liberia and Sierra Leone.

Cocoa production suffered in my community because farmers lacked adequate farm tools. We used to travel 20-25 miles just to access a tools centre.

Kumba Momoh, cocoa farmer

With the support of Solidaridad, Randlyn Holdings Limited, a private company, established a service centre in Buedu to enable Kumba and other cocoa farmers to access appropriate farming tools and other services.

For Kumba, being able to access agro-input without the constant hustle has been a real game changer. She is now able to save the money she would have spent on  transportation to purchase or hire tools to work  on her cocoa farm. The service centres also pre-finance input and farm management services for farmers who are unable to raise the needed capital for such services.

“The rural service centre is a helpful concept that has kept me and other farmers in business,” says 42-year-old Richard Kyei. 

I abandoned my farm because I could not raise enough credit to hire labour. But with service centres now available in my community, my farm is well taken care of and this has increased productivity and my income,” he says. 

Richard Kyei, Cocoa farmer

Richard is now harvesting 23 bags of cocoa beans from his 12-acre farm, which is a major leap from the nine bags he used to harvest before ‘Cocoa Ahwesofopa’, a service centre in the Brong Ahafo region of  Ghana, took over the management of his cocoa farm. 

“Now, I am able to plough back some of my profits into the business after catering for the needs of my nine children,” says Richard. 

Like Kumba and Richard, over 44,680 cocoa farmers in Cote d’Ivoire, Ghana, Liberia and Sierra Leone now have access to farm inputs and a variety of services that have increased their yields and improved their incomes and livelihoods.

Building the capacity of SMEs to access finance

Limited access to medium and long-term finance is the main challenge of scaling up commercial cocoa service delivery in West Africa. Bringing the service delivery initiative to scale requires adequate funding and financing mechanisms for their operations. 

In this regard, Solidaridad through an investment readiness support model prepared the SMEs for commercial funding to grow their businesses. The support, which included training in business modelling, climate-smart cocoa production and entrepreneurship, has given the SMEs the professional, business and technical management outlook needed to attract impact investors. The service centres also received customer (farmer) databases, laptops and other items.

“Our knowledge in good agronomic practices and entrepreneurship has enhanced through the various capacity building sessions”, says Kwabena Assan Mends, Managing Director of Emfed Farms and Trading Company Limited. 

“With this, Emfed Farms has been able to provide farm management and other services to 1,000 farmers. We have also been empowered to access credit to deliver value to farmers and other stakeholders,” he says. 

With enhanced capacity, Emfed Farms and Trading Company Limited has been able to access 46,810 dollars from the Acumen Global Emergency Facility. This has made it possible for the enterprise to extend support to cocoa-producing communities to deal with the shocks of the Covid-19 pandemic. 

Integration of Service Centres in National Systems towards sector transformation 

Due to its positive impact on Ghana’s cocoa yield and farmers’ livelihood, the Ghana Cocoa Board through its Cocoa Health and Extension Division (CHED), has been collaborating with Solidaridad to set up additional service centers in other cocoa districts and integrate the existing ones under the board’s service providers to benefit from government subsidy. The service centres are being used to treat and rehabilitate cocoa farms in selected communities in Ghana under the government’s Cocoa Rehabilitation Programme, aimed at treating and re-establishing 37,000 hectares of farms infested with Cocoa Swollen Shoot Virus disease.