1 Brussels, 16 December 2020 COCOA TALKS EU VIRTUAL MULTI-STAKEHOLDER ROUNDTABLES ON SUSTAINABLE COCOA Summary of feedback on the launch of Multi-stakeholder Dialogue on Sustainable Cocoa And proposed schedule of thematic roundtable meetings 1. Introduction On the 22 nd of September 2020, the European Commission launched with EU stakeholders an inclusive dialogue on sustainable cocoa production in Côte d’Ivoire and Ghana. The dialogue brings together key EU stakeholders, including representatives of Member States, the European Parliament, industry and civil society organisations. The Ambassadors of the Republic of Côte d’Ivoire and Ghana to the EU took part in the launch event with a supporting message from authorities of the respective countries. The objective of the multi-stakeholder dialogue is to foster progress in the elimination of child labour and child trafficking in cocoa supply chains, enhancing the protection and restorations of forests in cocoa-producing regions, and ensuring a living income for cocoa farmers. One-hundred and forty-six (146) participants attended the launch event from the EU, and the two cocoa-producing countries, Côte d’Ivoire and Ghana. At the end of the event, the European Commission, asked participants to submit their ideas on the following: how to organize the dialogue proper; proposed thematic groups and sub-groups; suggested topics for discussion; proposed schedule or timeline. The dialogue will continue to be led by the European Commission, respecting basic principles of inclusiveness, variety and balanced representation of participants, while seeking to keep thematic groups at a manageable size. The dialogue will seek to inform and shed light on the implications of the European Commission’s work on deforestation (led by DG Environment) and due diligence (led by DG
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Brussels, 16 December 2020
COCOA TALKS
EU VIRTUAL MULTI-STAKEHOLDER ROUNDTABLES ON SUSTAINABLE COCOA
Summary of feedback on the launch of Multi-stakeholder Dialogue on Sustainable Cocoa
And proposed schedule of thematic roundtable meetings
1. Introduction
On the 22nd of September 2020, the European Commission launched with EU stakeholders an inclusive
dialogue on sustainable cocoa production in Côte d’Ivoire and Ghana. The dialogue brings together key
EU stakeholders, including representatives of Member States, the European Parliament, industry and
civil society organisations. The Ambassadors of the Republic of Côte d’Ivoire and Ghana to the EU
took part in the launch event with a supporting message from authorities of the respective countries.
The objective of the multi-stakeholder dialogue is to foster progress in the elimination of child labour
and child trafficking in cocoa supply chains, enhancing the protection and restorations of forests in
cocoa-producing regions, and ensuring a living income for cocoa farmers. One-hundred and forty-six
(146) participants attended the launch event from the EU, and the two cocoa-producing countries, Côte
d’Ivoire and Ghana.
At the end of the event, the European Commission, asked participants to submit their ideas on the
following:
how to organize the dialogue proper;
proposed thematic groups and sub-groups;
suggested topics for discussion;
proposed schedule or timeline.
The dialogue will continue to be led by the European Commission, respecting basic principles of
inclusiveness, variety and balanced representation of participants, while seeking to keep thematic
groups at a manageable size. The dialogue will seek to inform and shed light on the implications of the
European Commission’s work on deforestation (led by DG Environment) and due diligence (led by DG
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Justice) on the cocoa sector and, over the longer term. The dialogue will aim to contribute to sustainable
cocoa production globally.
This report summarizes the feedback received from participants to the launch event and other
stakeholders. Based on this feedback, the report proposes a work plan and a timetable for the EU Multi-
Stakeholder Dialogue on Sustainable Cocoa.
2. Received feedback on proposed modalities of multi-stakeholder dialogue
The European Commission received feedback from twenty-five (25) organizations and one
individual. Feedback was sent in a standardized format (see Annex I) though some organizations chose
to depart from the standard format or complement it with additional material. Most responses consisted
of a list of proposed thematic groups, including the title of the thematic group and a short description
of the topics that should be considered by the group, as well as some general comments on the initiative.
Annex 1 contains a full list of respondents, organized by type of organization, and the number of
Thematic Groups proposed by each respondent.
The European Commission compiled and analysed the responses, identifying similar or recurring
themes and taking note of relevant discussion points listed under each of these themes. Understandably,
respondents organized their proposed discussion points into the three categories that make up the
sustainable development framework: economic, social and environmental.
In order to account for the interconnectedness of economic, social and environmental problems and to
drive discussions towards the development of cross-cutting solutions that can be operationalized across
the supply chain, the European Commission reorganized these inputs into the following six themes:
No. Title Subtitle
1. Living Income
Differential International/farm gate prices for cocoa and farmers’ incomes
2. Standards The role of public/private standards and certification
3. Regulations Due diligence, government regulations and other measures in
governing cocoa supply chains
4.
Traceability,
Transparency and
Accountability
Implementation mechanisms to identify, prevent and mitigate
negative human rights and environmental externalities along the
cocoa supply chain
5. Sustainable Cocoa
Production Systems
Empowering farmers and private actors to produce sustainable
cocoa through capacity-building, investment and an improved
enabling environment
6.
Coordination of
Technical Assistance and
Development Finance
Defining investment needs and coordinating delivery of technical
assistance and development finance.
Theme 1 on the Living Income Differential (LID) will focus on the operationalization of the LID and
other economic issues, taking into account the market implications of price initiatives. Theme 2 and 3
on Standards and Regulations will examine the rules and regulations that can support the elimination
of the negative social and environmental externalities of the cocoa economy, including both voluntary
measures by the private sector and government regulations. Theme 4 on Traceability, Transparency
and Accountability will reflect upon the practical mechanisms needed to monitor adherence to the rules
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and regulations discussed in Themes 2 and 3 and to enforce compliance on the ground. Theme 5 on
Sustainable Cocoa Production Systems will explore the needs of cocoa farmers – in terms of capacity-
building, investment and an improved enabling environment – to upgrade their cocoa production
systems, in line with the elements that will be discussed in previous Themes. Theme 6, entitled
Coordination of Technical Assistance and Development Finance, will identify sources of technical
assistance, official development aid and private investment that can be mobilized to meet the needs
identified in Theme 5, as well as ensuring that such assistance is delivered in a coordinated and coherent
manner. The following subsections expand upon the feedback received under each of these topics.
Theme 1: Living Income Differential
Under this topic, respondents noted the importance of adopting a common approach to a living
income for cocoa farmers. In this regard, a joint submission by the EU Member States (Germany and
the Netherlands) encouraged the dialogue to “build on the discussions and findings by the Living
Income Community of Practice and Alliance on Living Income in Cocoa (ALICO)”. UNICEF provided
its own definition: “A living income is defined as sufficient income to afford a decent standard of living
for all household members – including a nutritious diet, clean water, decent housing, education, health
care and other essential needs, plus a little extra for emergencies and savings – once farm costs are
covered”. In its feedback, Fairtrade noted: “Fairtrade has developed a holistic living income strategy
and is involved in multiple pilots in an increasing number of commodities. West African cocoa was the
lead commodity.1Fairtrade has estimated a farm gate price $2,100 per tonne in Ghana and $2,200 per
tonne in CDI with an increased productivity compared to current averages would be needed to reach a
living income.2”
In addition to the definitional issue, respondents recommended a work stream on the development of
strategies to raise farm gate prices and increase/diversify incomes for cocoa farmers. Two existing
mechanisms could inform the development of such a strategy, in particular:
(i) Côte d’Ivoire and Ghana’s joint initiative to support farmers’ revenues through the in-
troduction of the ‘Living Income Differential’ (LID), a premium of $400 on global market
prices that applies to the purchase of cocoa from these two origins, and
(ii) private interventions, including the longstanding collaboration between the private sector
and third-party certification bodies such as Fair Trade that seek to provide a price premium
for certified cocoa.
Respondents recommended that this work stream should assess these initiatives’ effectiveness and
their sustainability over the long run, in order to generate a set of lessons learnt and a catalogue of
best practices that lead to higher and more diversified incomes for cocoa farmers. Specific attention
should be paid to the traceability of payments, to ensure that a fair share of the price increases is
actually passed on to farmers, as well as the relationship between price initiatives and supply-
demand conditions in domestic and international cocoa markets. Touton referenced an ongoing study
by GIZ on the impact of the LID initiative on supply and demand conditions, while the ICCO, EU
Member States, and several Civil Society Organizations mentioned the need to consider supply
management mechanisms to prevent overproduction e.g., the introduction of additional storage
capacities or a quota system. The objective of this work stream would be to identify the levers that
empower producers to obtain better prices for their cocoa and to define the role of the EU in promoting