Can Africa’s new cocoa alliance finally capture more of chocolate’s $150bn value?

Focus on industrialisation in Africa

New African will be publishing a series of articles on how the continent can move from its status as a producer of raw commodities to a fully-fledged industrial region. The following is the first in the series.

 

The global chocolate industry is worth $130bn annually, but Africa, which produces up to 75% of the cocoa that is an essential ingredient in chocolate, gets only a fraction of this value. In an effort to change this relationship, Africa’s main cocoa producers have formed the Cocoa Value Addition Alliance to move from raw exports to local value addition. But to do so, they will have to overcome several obstacles, as Kwame Ofori Appiah reports.

For generations, West Africa has been the engine of the global chocolate industry. Every year, millions of tonnes of cocoa beans leave the ports of Abidjan, Tema, Douala and Lagos for processing plants in Europe, North America and increasingly, Asia.

By the time those beans are transformed into chocolate bars, confectionery, cosmetics and beverages, most of the economic value has already migrated thousands of kilometres away from the farms where the cocoa was grown.

It is a paradox that has long frustrated policymakers across Africa. Côte d’Ivoire and Ghana alone account for around 60% of global cocoa production, while Nigeria and Cameroon are also among the world’s leading producers. Yet Africa receives only a small share of the estimated $130bn global chocolate industry, as the highest-value activities remain concentrated outside the continent.

It is this that the newly formed Cocoa Value Addition Alliance aims to change. At the Cocoa Value Addition Summit held in Abuja in July, Nigeria, Ghana, Côte d’Ivoire and Cameroon signed the Abuja Declaration, creating a common platform to coordinate industrial policy, promote domestic processing and negotiate with international markets as a unified bloc.

Operating under the theme ‘From Bean to Brand’, the alliance seeks to move, collectively, from raw exports to local value addition.

For some analysts, the temptation has been to compare the initiative with OPEC. Like the oil cartel, the four countries collectively possess considerable market power, accounting for roughly 70-75% of global cocoa production. Acting together undoubtedly strengthens their negotiating position with multinational traders and manufacturers.

But the similarities largely end there. Unlike OPEC, the Cocoa Value Addition Alliance is not designed to manage production quotas or manipulate prices. Instead, its principal objective is to increase the proportion of cocoa processed within producing countries before export.

The Abuja Declaration envisages cooperation on investment promotion, industrial standards, research, financing, trade policy and common positions on emerging regulations such as the European Union Deforestation Regulation (EUDR).

It is fundamentally an industrialisation agenda rather than a supply-management mechanism. That distinction matters because Africa’s greatest challenge is insufficient participation in the downstream value chain, rather than insufficient cocoa production.

Value addition dilemma

The cocoa industry has long exemplified Africa’s value addition dilemma. While West Africa dominates cocoa cultivation, Europe continues to dominate chocolate manufacturing. Countries such as Germany, Belgium, Switzerland and the Netherlands have built globally recognised chocolate industries despite producing virtually no cocoa themselves.

Beans are converted into cocoa liquor, butter and powder before becoming chocolate, confectionery, beverages, cosmetics and pharmaceutical ingredients. Each processing stage generates more employment, more tax revenue and higher export earnings than simply shipping raw beans.

Consequently, although cocoa remains one of the most important export commodities for Ghana and Côte d’Ivoire, much of the industry’s profits accrue elsewhere. This has become increasingly difficult for African governments to accept, particularly as commodity price volatility continues to expose the vulnerability of export-dependent economies.

Nigeria’s President Bola Tinubu, speaking through Nigeria’s Minister of Agriculture and Food Security at the summit, argued that the era of exporting raw beans while importing finished chocolate products must end.

Similar sentiments have been expressed by officials from Ghana, Côte d’Ivoire and Cameroon, who see cocoa processing as central to industrial development rather than merely agricultural policy.

This thinking aligns closely with the African Union’s industrialisation agenda and the objectives of the African Continental Free Trade Area, which seeks to promote regional manufacturing value chains instead of commodity exports.

If cocoa can be processed regionally rather than nationally, countries need not duplicate every segment of production. One country could specialise in grinding, another in butter production, another in chocolate manufacturing, creating integrated regional supply chains that serve both African and international markets.

Skills upgrade and employment benefits

Perhaps the strongest economic case for value addition lies in employment. Cocoa farming supports millions of smallholder households across West and Central Africa, but agriculture alone cannot absorb the continent’s rapidly expanding labour force. Processing industries, however, have the capacity to do so.

Grinding facilities, food manufacturing, packaging, logistics, quality assurance, machinery maintenance, research laboratories, branding agencies and retail all generate substantially more employment than exporting raw commodities.

The chocolate industry is also significantly more skill-intensive, creating opportunities for engineers, food scientists, industrial designers, marketers and logistics specialists alongside factory workers. For countries seeking to create jobs for their youthful populations, this broader value chain offers far greater long-term potential than primary production alone.

Industrialisation, however, requires capital. Recognising this, Nigeria’s Bank of Industry used the Abuja summit to unveil a financing strategy specifically aimed at accelerating cocoa processing and manufacturing.

The bank’s managing director, Dr Olasupo Olusi, noted that Africa currently captures only a tiny proportion of the value generated from chocolate despite producing around 70% of global cocoa. Closing that gap, he said, requires targeted investment in processing facilities, manufacturing capacity and industrial infrastructure rather than simply increasing agricultural output.

Another notable aspect of the alliance is its commitment to coordinated international engagement. Historically, African cocoa producers have often negotiated separately despite sharing many of the same concerns.

By adopting common positions on international trade issues, sustainability standards and regulations such as the EUDR, the four countries hope to strengthen their collective influence over the rules governing global cocoa markets.

Structural obstacles

This cooperative approach mirrors a broader trend within African trade policy, where countries increasingly recognise that collective bargaining can produce better outcomes than fragmented national positions. Ambition alone, however, will not transform the cocoa economy and the alliance faces several structural obstacles.

First is infrastructure. Cocoa processing requires reliable electricity, efficient transport systems and modern industrial facilities, all areas where many African economies continue to face significant constraints.

The second is investment. While multinational processors have established some grinding capacity in Côte d’Ivoire and Ghana, much larger investments will be required if African countries are to manufacture finished consumer products at scale.

Another is competitiveness. Global chocolate manufacturing has evolved over decades, benefiting from sophisticated logistics, established brands, advanced food technology and extensive distribution networks. African manufacturers will need to compete not simply on labour costs but also on quality, food safety, innovation and branding.

Finally, domestic consumption remains relatively low compared with Europe and North America. Expanding African markets for chocolate and cocoa-based products will therefore be important alongside export promotion.

The significance of the Abuja Declaration, however, extends well beyond cocoa itself. For decades, policymakers have spoken about moving up the global value chains. The alliance represents one of the clearest attempts to translate that aspiration into coordinated policy.

Whether similar alliances emerge around coffee, cotton, cashew, lithium or critical minerals remains to be seen. But cocoa offers a compelling starting point.

The Abuja Declaration will ultimately be judged not by the commitments made at the summit but by the factories built, the investments mobilised and the exports transformed over the coming decade.

If the alliance succeeds in increasing local processing, expanding manufacturing and creating globally recognised African chocolate brands, it could become a landmark example of commodity-led industrialisation. If not, West Africa risks continuing the familiar pattern of exporting raw materials while importing finished products at a premium.

The ‘From Bean to Brand’ vision therefore represents something much larger than cocoa policy. It is a test of whether Africa can finally convert its natural resource advantages into industrial capability, skilled employment and greater control over the value chains that have long generated wealth elsewhere.

For the four countries that collectively grow the vast majority of the world’s cocoa, the question is no longer whether they can produce the beans. It is whether they can also produce the brands.