Gold Coast (Cocoa Industry).

Part of Oral Answers to Questions — Trade and Commerce. – in the House of Commons at on 4 May 1938.

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Photo of Mr William Ormsby-Gore Mr William Ormsby-Gore , Stafford

I apologise for the length of the reply. As the hon. Members will be aware, the greater part of the present season's Gold Coast cocoa crop has not so far come upon the market. At the beginning of the season the majority of firms buying cocoa on the Coast entered into an agreement regarding the terms of their operations. As the growers in the Gold Coast considered that the existence of such an agreement was detrimental to their interests, they for several months refused to sell their cocoa and this hold-up applied not only to the agreement firms but also to other firms who were not parties to the agreement. In order to facilitate the solution of this deadlock and to prevent the large accumulated stocks of cocoa from being placed suddenly upon the market at a rate beyond its capacity to absorb them, the Government of the Gold Coast have recently passed legislation to control the export of this year's crop. The legislation is purely temporary and will remain in force only until October.

I am happy to say that, partly as a result of this legislation, the parties to the agreement have now suspended it and the hold-up of cocoa by the growers has been brought to an end. During the negotiations which have led to this result the terms of the legislation which has been passed were naturally discussed with both parties, that is to say, with the agreement firms on the one hand and with the representatives of the growers on the other hand. Under this legislation the greater part of the licences to export cocoa up till 1st October will be allotted to each firm engaged in the trade in proportion to its share of the trade in each of the last two crop years. Each firm will thus be able to enjoy the same share of the trade that it has had in the past. The remaining licences representing 6 per cent. of the total exports or a minimum of 2,000 tons a month will be retained by the Governor for allocation at his discretion, and it is the intention that this discretion should be exercised particularly in favour of African shippers. This amount is much larger than that ever exported by African shippers in the past.

I cannot accept the suggestion that the quota legislation is detrimental to the African producer. I am sorry that it should be considered unfair to any other interest, but the great difficulty will be appreciated of discovering any basis for the allocation of licences in the existing difficult situation which is not open to some criticism, and I am satisfied that on no other basis consonant with due regard to the interests of all parties would it have been possible to secure both the termination of the hold-up by the producers and the suspension of the Agreement by the firms concerned. This was the primary objective, and it is clear that its attainment will benefit all firms trading in the Gold Coast whether they have been parties to the Agreement or not. Before next season's crop I hope to have received the report and recommendations of the Special Commission now in West Africa on any future arrangements regarding the sale of cocoa.