Pathways to Sustainable and Deforestation-Free Cocoa in Ghana

Summary

From 2018 to 2022, the United States Agency for International Development (USAID) backed the Supporting Deforestation-Free Cocoa activity. Their aim was both improved economic development and environmental outcomes, including reduced deforestation and greenhouse gas (GHG) emissions, increased carbon sequestration in the cocoa landscape, increased cocoa farm productivity and resilience, and improved farmer livelihoods.

At endline, the evaluation employs a mixed-methods impact and performance evaluation approach to answer eight evaluation questions pertaining to the effects of the activity’s five intervention components:

1. Farm-level tenure documentation;
2. Tree tenure formalization;
3. Farm rehabilitation;
4. Landscape governance and community land use planning; and
5. Payments for ecosystem services.

The endline evaluation relied upon five main sources of primary and secondary data:

1. Household surveys at baseline and endline;
2. Carbon stock measurement on farms at baseline and endline;
3. Semi-structured interviews with key Government of Ghana actors;
4. Focus group discussions (FGDs) with farmers, women, sharecroppers, and customary leaders; and
5. Secondary monitoring data and administrative data to track aspects of program implementation.

The evaluation found strong impacts on documentation and shade tree planting, as well as significant impacts on shade tree survival, some measures of investment, crop productivity, and food security. Overall, the program did seem to have had an economic impact, shown most clearly by the cocoa production numbers and the reduction in food security.

There is a lack of climate mitigation impact, which lends support to skepticism that economic development interventions can actually mitigate climate change because economic development often uses resources. However, the time frame for observing changes in environmental outcomes is arguably too short for the period of evaluation. Finally, efforts to increase tenure security are mixed—in part because reduced uncertainty from the provision of mapping, registration, and documentation leads people to engage in economic activities, such as cutting down their shade trees.

Background

Ghana and Cote d’Ivoire (CDI) are by far the two largest cocoa producers in the world, and cocoa production is the fourth largest commodity production—behind beef, palm oil, and soy—that drives global deforestation, associated greenhouse gas (GHG) emissions, and biodiversity loss (Antonarakis 2022). Cocoa production flourishes in the Guinean forest biome in Ghana and CDI, a biodiverse lowland and tropical forest region with more than 60 endemic mammalian species.

Several factors drive deforestation in cocoa producing landscapes, including agricultural expansion, weak and mismatched land and resource governance, excessive local harvesting of wood for fuel, and insufficient sustainability practices (e.g., climate-resilient agroforestry). Agricultural expansion is driven by the increasing global demand for cocoa and declining yields (and farmer income) associated with climate change. A 2017 research study by Mighty Earth attributed approximately one quarter of the deforestation in Ghana and CDI from 2002 through 2014 to the cocoa and chocolate industries (Higonnet et al. 2017). Climate change has increased extreme weather variability, which has led to drought, disease, and reduced pollination. These factors have combined to further reduce cocoa yields, and as cocoa yields and income continue to decline, land conversion is exacerbated in a vicious feedback cycle.

A high percentage of cocoa farmers live below the poverty line and experience food insecurity. As there are few non-cocoa income opportunities and the costs of switching to non-cocoa production are high, farmers compensate for declining yields by producing more cocoa on more land. The limited earnings from cocoa production also reach men and women disproportionately. According to the International Cocoa Initiative, women own between a fifth and a quarter of the cocoa farms and comprise most farm labor in both countries (CARE International 2015). A 2009 study by Harvard University found that women cocoa farmers in Ghana earn between 25 and 30% less than their male counterparts, and in CDI, up to 70% less (Hiscox and Goldstein 2014). In both countries, women have less access than men to land, credit, farm inputs, technical support, social security, and other services.

Intervention

In this context, from 2019 to 2023, the U.S. Agency for International Development’s (USAID) Supporting Deforestation Free Cocoa (SDFC) project aimed at promoting landscape-scale improvements in secondary forest areas and farmer livelihoods in the Wassa Amenfi West District of Ghana’s Western Region.

SDFC sought to reduce deforestation, improve local livelihoods, enhance cocoa productivity, and strengthen land rights. To achieve these objectives, the project combined a cocoa agroforestry intervention with a property rights intervention. Cocoa agroforestry emphasizes shade tree planting to promote improved and sustainable cocoa productivity while keeping cocoa production deforestation-free.

However, a key challenge to planting more shade trees for cocoa agroforestry in Ghana is government ownership of commercial rights to all naturally occurring (timber) trees, even on privately held land (Climate Investment Funds 2023). Primary project activities included cocoa agroforestry and shade tree planting through a payment-for-ecosystem (PES) model paired with land (LandSeal) and tree (TreeSeal) tenure mapping, registration, and documentation to strengthen tenure. These activities were expected to increase cocoa farm productivity and resilience and improve farmer livelihoods while reducing deforestation and GHG emissions.

The purpose of this digest is to provide a summary of SDFC’s effect on households in the program areas, along with a description of the mediating factors, opportunities, and challenges to achieving sustainable and deforestation-free cocoa in Ghana.

Research Methods

The Penn Development Research Initiative (PDRI-DevLab) and The Cloudburst Group, a woman-owned small business that specializes in implementation research and land tenure, recently completed an endline impact evaluation (IE) of the SDFC project in Ghana, which was funded by USAID and Hershey. The project sought to reduce deforestation and GHG emissions and increase carbon sequestration in the cocoa landscape, increase cocoa farm productivity and resilience, diversify farmer incomes, reduce inter-farmer and intra-community conflict, and improve farmer livelihoods in the Western Region of Ghana.

To examine impact and performance outcomes, the endline evaluation employed a rigorous quasi-experimental IE design with quantitative and qualitative data collection at endline from farmers in five treatment villages and six comparison villages.

To examine impact and performance outcomes, the evaluation draws upon five main sources of primary and secondary data:

1. Household surveys at baseline and endline;
2. Carbon stock measurement on farms at baseline and endline;
3. Semi-structured interviews with key Government of Ghana actors;
4. Focus group discussions (FGDs) with farmers, women, sharecroppers, and customary leaders; and
5. Secondary monitoring data and administrative data to track aspects of program implementation.

Key Findings

Documentation

The evaluation data confirm that treatment households received the FarmSeal and TreeSeal interventions, as households living in treatment areas are significantly more likely to have received documentation. Generally, lack of knowledge, expense, and a complicated process are hindrances to documentation. Thus, although demand is high, the evaluation finds no change in willingness to pay for documentation among treatment respondents.

Cocoa Agroforestry and Payment for Ecosystem Services

Similar to the findings on documentation, households living in treatment areas are significantly more likely to have participated in a PES program and engaged in cocoa agroforestry. Treatment households are more likely to have planted shade trees in the last one to five years, and the number of shade trees planted by program beneficiaries during those timeframes was significantly higher. Treatment respondents were more likely to report that at least half of the shade trees planted in the last year were still alive. A minority of respondents reported that cocoa agroforestry was a challenging activity.

Farmers across all villages described the search for financial security, for themselves, their family, and descendants as the main driver for their decision to engage in cocoa agroforestry. Farmers reported that they already saw many benefits from planting shade trees, including improved cacao productivity, reduced need for fertilizers, and increased access to firewood and timber. Non-agricultural benefits, such as stronger land security and future land value, were also mentioned. Many expect additional advantages in the future, such as enhanced soil fertility and greater resilience to climate change. The trees also protected the crops from harmattan (dry, dusty winds).

However, some farmers highlighted unequal access and benefits from the PES program. In Ghana, more female farmers, relative to male farmers, reported not having received any shade trees or training for planting them. Overall, despite some negative effects of having more trees (e.g., more insects and bugs increased the need for a better access to pesticides), most farmers believed the benefits they received from shade trees outweighed the costs.

For uptake of shade tree planting at the farm level, we found some evidence that households born in the village were more likely to take up shade tree planting. Cocoa training was associated with more trees planted on the farm, greater involvement in replanting efforts, and greater field investments. In contrast, mining activity was associated with significantly less shade tree planting.

There was qualitive evidence that tree registration could support shade tree planting and maintenance of shade trees by increasing perceived tenure security that they would reap future economic benefits and by reducing the likelihood of preemptively cutting trees. However, respondents also expressed an interest in using the tree registration to support current land clearing efforts.

Tenure Security

The study finds that respondents perceived land documentation to be more valuable than tree documentation. Most tenure security impact indicators showed a null treatment effect. However, one key indicator showed increased concern about losing rights to the farm in the next three years. This result was driven by women, for whom the magnitude of the effect was greatest. In contrast to the aggregate panel results, the analysis of tenure security indicators for direct program beneficiaries at endline indicated mostly positive results. The exception is PES beneficiaries who were less likely to report that they were able to fallow land without worry.

Significantly, documentation and higher perceived tenure security was not associated with higher levels of shade tree planting. Results for survival were mixed.

Finally, tenure insecurity around replanting continue to affect land use decisions for sharecroppers. We did not find compelling evidence that the land documentation either helps the sharecroppers with replanting or motivates greater rehabilitation.

Investment and Productivity

Cocoa diseases and pests remain significant challenges to cocoa productivity and to rehabilitation and replanting. The evaluation found evidence of positive treatment effects on cocoa productivity for direct program beneficiaries, which is in line with positive investment findings for pesticide and herbicide purchases among PES beneficiaries. In addition, there were significant impacts for sharecroppers on overall investment and fungicide purchase, as well as a reduction in land under fallow.

Livelihoods

The evaluation found a positive program impact on food security, especially sharecropping households, although the positive result for food security did not extend to female-headed households. On average, treatment households were more likely to have engaged in off-farm employment activities, particularly direct program beneficiaries. Income from off-farm endeavors was also higher among beneficiaries.

Finally, there was a strong financial incentive to shift to illegal gold mining, given the myriad of challenges facing cocoa farmers. Artisan and small-scale mining (ASM) was an important livelihood activity for a minority of households in the study area. The program did not appear to have affected its prevalence.

Land Clearing

Based on satellite geospatial data, calculations of forest area loss indicated roughly equal deforestation rates across treatment and control areas in the last ten years. The total forest loss in the past ten years exceeded 750,00 hectares. For treatment households, the forest loss ratio in the last five years was 9%, and in the previous ten years, 16%. 

Similarly, the evaluation found null and mixed effects of the program on land clearing indicators from the household survey, including reported size of forest and bush clearing, along with future plans for land clearing.

Carbon Stocks

The study found that carbon stocks decreased between baseline and endline in almost all communities, and that – at program completion – carbon stocks were higher in control communities than in treatment communities.

Table 1 below provides a summary of the key impact evaluation results pertaining to program outputs, the main outcomes of interest, intermediate outcomes that are expected to mediate program impacts, and additional program facilitators that are also expected to mediate program impacts.

Conclusion

Cocoa farmers in Ghana face several challenges in trying to maintain cacao productivity, with aging plantations, lack of fertilizers and pesticides, and soil degradation being the most common issues. Climate change further exacerbates productivity issues, while poor infrastructure hinders the timely sale of cacao. However, as farmers burn forests in their attempts to increase cocoa yields by expanding cocoa plantations, cocoa farming itself exacerbates the damage done by climate change, leaving crops without shade trees to protect against the sun that scorches crops.

To address these development challenges, the SDFC project had multiple aims. These included:

1. Reducing deforestation and greenhouse gas emissions;
2. Increasing carbon sequestration in cocoa producing landscapes;
3. Improving cocoa farm productivity and resilience;
4. Strengthen land and tree tenure; and
5. Improve livelihoods for cocoa farmers.

The evaluation found some important impacts. These included a significant increase in tenure documentation (for both trees and land), an improvement in shade tree planting and survival, and a significant improvement in food security. Treatment households were more likely to have engaged in off-farm employment activities. Income from off-farm endeavors was also higher in the group that received PES. There was some evidence of increased pesticide and herbicide purchase, but the evaluation did not detect overall changes in land investment as measured by an index of field-level investment activities.

However, there were also mixed outcomes. Tenure security did not improve as expected, even though documentation increased. Cocoa tree rehabilitation replanting was mixed, with relatively low program uptake. Carbon stocks also did not improve, with evidence that continued land clearing occurred. The program does not appear to have affected the presence of illegal gold mining, which remains an important livelihood activity for a minority of households in the study area.

As a result, specific challenges remain, such as tenure insecurity for specific groups, including sharecroppers, individuals who derive security from family institutions, and tenant farmers. Farm rehabilitation as designed did not offer clear significant gains to the farmers targeted and while the Payment for Ecosystem Services appears promising given uptake, the actual effectiveness at reducing clearing in current structure is not clear.

Policy Recommendations

Looking ahead, the following policy recommendations might be considered:

1. Engage landowners and land users across different tenure arrangements. Levels of tenure security are fairly high, but where there is insecurity documentation alone is not sufficient to enable farmers to invest or change practices. To improve tenure security, activities should engage landowners and land users across different tenure arrangements. These include for sharecroppers, individuals who have families-based tenure, and local officials who are involved in providing security. Engagement across a wider range of actors , perhaps through dispute resolution or opportunities to clarify or upgrade the documentation of usage agreements could be explored with a specific focus on groups who face more insecure tenure and few incentives to invest.
2. Increase efficiency of farm rehabilitation. Beyond making sure that tenure is sufficiently secure, exploring how to improve program targeting and financing could improve uptake. A key scope condition may be supporting farmers with access to technology and tools that overcome barriers to successful farming, including pest management and “hearty” seedlings.
3. Improve the Payments for Ecosystems Services (PES) program. The take-up of PES offer a promising indication that this kind of activity could produce benefits for farmers and for the environment, but the design of the program should be better targeted and more clearly incentivized. For farmers to successfully comply with PES they need to have sufficiently secure tenure. In addition, the financial benefits of participation in the medium- to long-term must outweigh the short-term costs of harvesting trees. Further exploration of how to link PES to planting and, subsequently, tree cover might improve the impact of part of the intervention.
4. Better link PES to incentives. Overall, multi-pronged engagement with cocoa farmers improved economic resilience and shows promise in poverty alleviation. However, to achieve this result alongside significant improvements in climate mitigation and longer-term resilient farming requires linkages between program components, clearer targeting, stronger financial incentives and a broader approach to tenure security.

References

Antonarakis, A.S., L. Pacca, and A. Antoniades. 2022. “The Effect of Financial Crises on Deforestation: A Global and Regional Panel Data Analysis.” Sustainability Science. 17, 1037-1057. https://doi.org/10.1007/s11625-021-01086-8.

CARE International. “Emerging Best Practices of Women’s Leadership within Cocoa Farming in Ghana and Côte d’Ivoire.” Cocoa Initiative. https://www.cocoainitiative.org/sites/default/files/resources/womens-leadership-in-cocoa-life-communities-full-report-oct-2016.pdf.

Higonnet, E., M. Bellantonio, and G. Hurowitz. 2017. “Chocolate’s Dark Secret: How the Cocoa Industry Destroys National Parks.” Mighty Earth. https://www.mightyearth.org/wp-content/uploads/2017/09/chocolates_dark_secret_english_web.pdf#:~:text=In%20that%20same%20time%2C%20Ghana%20lost%207%2C000,10%20percent%20of%20its%20entire%20tree%20cover.

Hiscox, M.J. and R. Goldstein. 2014. “Gender Inequality in the Ghanian Cocoa Sector.” Business and Human Rights Centre. https://media.business-humanrights.org/media/documents/c1a79aad5de19b140dac9424b66af83e4fbfbbc4.pdf.