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November 28, 2010

Why Ghana gave in to the cocoa baron

by Cameron Duodu

I read ‘British Constitution’ for my A-levels in the University of London General Certificate of Education (GCE) examination. I studied part-time, because I was in full-time employment at the Ghana Broadcasting System (as it was then).

But help was at hand – the University of Ghana’s Extra-Mural Studies Department, headed by a very nice Englishman called David Kimble, had assembled an excellent group of lecturers who lectured us free of charge, at 5pm Monday to Friday, depending on the subject one chose. Bishop’s Girls’ School, at High Street, in Accra, was where my particular set of lectures were organised, under the auspices of an excellent adult education body called ‘The People’s Educational Association’ (PEA).

There, I was introduced to such mysteries as the difference between ‘written law’ and ‘convention’. Some of it seemed rather abstruse: I mean how was a ‘convention’ expected to hold so strong in any society that the convention would be enforced, through the magic of sheer self-regulation, by the rulers and the opposition alike? Yet we were assured it did work, one of the best examples being the position of the Speaker of the House of Commons, who is elected by the whole House from the ranks of the majority party, and yet, once elected, becomes an ‘impartial’ chairman of the debating process. Convention, embodied in a book called ‘Erskine May’ for short (after its author) obliged the Speaker to be scrupulous in allowing equal time for government and opposition to speak and take part, generally, in the business of ‘The House’, on as equal a basis as was practicable.

Another ‘convention’ that we were taught was that ministers of the crown, although legally the nominal ‘masters’ of the (unelected) civil servants, were yet expected to restrain themselves from asking civil servants to do anything that was ‘not proper’. Some sort of ‘ministerial code’ existed, we were told, which governed ‘proper’ relations between ministers and civil servants.

In Ghana, which was expected to follow British democratic practices after independence, these rules were written down in a huge guide called ‘General Orders’, and the more curious of us often looked at it, but to very little effect. At Broadcasting House, for instance, the ‘General Orders’ resided on the desk of a guy called ‘Mr Crabbe’, who had been at Broadcasting House ‘forever’, and would tell you that you could not go on leave twice in a year, if you dared ask for time off. If you protested, he would just mumble ‘General Orders!’ to you and off you would trot to sulk in private.

What a minister – in charge of the Broadcasting budget – could or could not do was hardly ever our problem: The minister would phone the director of broadcasting, the director would phone the head of news, and an offending item would mysteriously disappear from the news bulletins. Or be modified. No questions asked. And so it went on.

But then, the BBC men who were director-general of broadcasting and head of news in my time, soon left. And some ministers began to phone in to the news desk directly, with any complaints they might have. Very soon – in 1960, to be exact – we had men from the ruling Convention People’s Party (CPP) installed everywhere. In the newsroom, we had no less a personage than Kodwo Addison (who was later to become director of the Kwame Nkrumah Ideological Institute, Winneba) installed as an ultra-establishment ‘news and current affairs executive’. Censor, if you cut out the euphemisms.

Addison had to append his signature to every news item we were to broadcast before it went on the air. Often, he came late to the newsroom and we would be twiddling our fingers as the news bulletins we had assiduously assembled, lay there waiting for him, while the clock ticked towards news time.

If we had known the reality that lay behind British politics, perhaps we would not have grieved too much. For the British appear to have effectively jettisoned some of those very nice, unwritten rules that guide the relationships between politicians and civil servants. If you read the memoirs of top politicians and civil servants, you will find that some civil servants carry out, or even initiate, actions meant to benefit the political careers of the ministers they serve.

The British newspaper, the Sunday Times, has just given the world an insight into what is currently happening to some of these relationships. The paper revealed, in its issue of 31 October 2010, that the British Foreign and Commonwealth Office, at the instance of the minister of international development, got the British high commissioner in Accra, a civil servant, to lobby the Ghana government over a case in which an employee of a private British cocoa-buying firm called Armajaro, was caught smuggling cocoa from the Western region of Ghana to the Ivory Coast. The smuggling operation was uncovered by a very brave Ghanaian investigative journalist, Anas Aremeyaw Anas, who has won several international awards for solid investigative journalism.

The Sunday Times reports that in early July 2010, Andrew Mitchell, British secretary of state for international development, was passed a three-page letter from a donor who had given money to Mitchell’s Conservative Party. The letter was from Anthony Ward, a commodities trader known in British business circles as ‘Chocfinger’ (an allusion to the James Bond movie villain, Goldfinger) for his audacious deals in the cocoa market. (Instead of gold, his specialty was in the commodity used for chocolate, hence ‘Chocfinger’).

Ward was aggrieved. His company had been banned from the Western Region of Ghana, after one of its contractors was caught in a smuggling sting. There had been efforts by local British diplomats to end the ban, but Ward wanted the clout of a government minister. ‘We therefore would like to ask you to intervene on our behalf at presidential level [in Ghana] to request the ban be lifted with immediate effect,’ Ward’s letter to the minister said.

‘With immediate effect!’ As if Ghana was still a British colony which would dance to the tune of a British minister, like African civilians taking orders from military rulers, after one of our numerous and nefarious coups d‘etat!

Ward’s letter suggested that one potential lobbying opportunity would be a UK-Ghana investment forum in London which the Ghanaian vice-president, Mr John Mahama, was due to attend.

Ward’s name was familiar to Mitchell (the Sunday Times reveals). His company had donated £40,000 to Mr Mitchell’s office. It had also donated £50,000 to the Conservative party separately.

The Sunday Times adds: ‘Just days after Mitchell read the letter, the Ghanaian vice-president was indeed lobbied on behalf of Ward’s company by a Foreign Office minister at a dinner on the eve of the trade forum. Mitchell now faces questions about his exact role in the fast-tracked decision to put a government minister into battle for the company, Armajaro Holdings.

‘Mitchell’s intervention is the first apparent conflict of interest for a [David Cameron-headed] coalition government minister. Ward, 50, is a co-founder of Armajaro, one of the world’s largest cocoa commodity traders. With estimated wealth of £36m, he was reported to have cornered a chunk of the [international cocoa] market, buying 240,100 tons of cocoa beans for £658m. He is believed to have taken delivery of the cocoa at the start of July, at about the time he sought Mitchell’s aid.

‘The matter raised by Ward involved British business interests overseas, which meant it was outside Mitchell’s remit. But after considering the contents of the letter, he called Nicholas Westcott, the British high commissioner to Ghana.

‘Armajaro’s problems can be traced back to last April when an undercover reporter [Anas Aremeyaw Anas] exposed a smuggling epidemic from Ghana to Ivory Coast involving security officials and cocoa companies.

A contractor for Armajaro Ghana offered to buy cocoa to be smuggled to Ivory Coast, where prices can be significantly higher. The Ghanaian government sets a fixed cocoa price for its farmers.

‘In his conversation with Westcott on July 6, Mitchell immediately declared his interest in the donations from Ward. Westcott assured him he had already raised the matter with Ghanaian officials.

‘Westcott confirmed the details in Ward’s letter about a forthcoming UK-Ghana trade forum in London. He said the matter could possibly be raised by Henry Bellingham, [the British minister at the Foreign and Commonwealth Office.]’

Despite some initial misgivings about lobbying for Armajaro, officials eventually concluded that Mr Bellingham should raise the matter. He dined with Mr Mahama on the eve of the trade forum and, after briefings from officials, lobbied him on Armajaro’s behalf. Westcott too attended the UK-Ghana trade forum at Drapers’ Hall in the City of London, and also took the opportunity to lobby on Armajaro’s behalf.

According to the Sunday Times, ‘the campaign paid dividends. On July 12 Westcott reported in an internal memo [obtained by the Sunday Times under the Freedom of Information Act] that the Ghanaian vice-president was going to look into the ban ‘immediately’. In August, Westcott, knowing Mitchell’s interest, wrote to Mitchell’s department: ‘I raised the urgent need to (and advantages of) raising the ban on Armajaro purchasing cocoa in Ghana’s border region.’ He said a draft decision made by the [Ghana] Cocoa [Marketing] Board lifting the ban meant the matter should soon be ‘sorted’.

And indeed, writes the Sunday Times, ‘The ban was finally lifted in September [2010], except in the district where the smuggling originated.’

Of course, consciences, such as existed, were salved all round by regarding ‘the employee, a contractor who was exposed offering to help to buy cocoa for the undercover reporter in western Ghana, as a rogue operator’. Yes, they are always ‘one bad apple’, aren’t they? But even it was one bad apple, did convention allow that the company that should be held responsible for his actions – for failing to put adequate measures in place to ensure that cocoa its agents bought in Ghana was not smuggled into the Ivory Coast to increase that country’s exports as against those of Ghana, and undoubtedly, the export duty arising out of the smuggled cocoa exports?

A DFID spokesman told the Sunday Times that ‘The letter from Armajaro was dealt with in accordance with normal ministerial procedures’.

The Foreign and Commonwealth Office, for its part. insisted to the paper that ‘it had not fast- tracked Ward’s request for help.’

If Mr Mahama is reading this, he ought to ask himself whether the Ghana high commissioner in London could equally intervene with the British government on behalf of a Ghanaian company involved in denying Britain of potential export receipts. Then he should also ask to be briefed on the activities of hedge funds, such as Armajaro. If Mr Mahama doesn’t know, such hedge funds are among the companies whose activities ensure that Ghana’s earnings from cocoa fluctuate on the world market. They can be so harmful to any economy that after the great banking collapse of 2008-9, even the free trade adherents in the West sought to impose controls on their activities.

Armajaro, in particular, is of great relevance to us in Ghana, for it is so expert at manipulating the cocoa market that it could even be accused of industrial espionage, no less. According to reports by authoritative British publications, its CEO, Mr Ward, sends experts into cocoa farms in West Africa ‘to count the pods’ on cocoa trees, so as to aggregate the yield and thereby be able to forecast the eventual size of each country’s crop accurately. Such an accurate forecast enables the company to ‘take positions’ on the international market for cocoa, that reap huge profits for the company.

Most patriotic governments would ban such companies from their countries as doing harm to their exports (in the final analysis) if they could. But in the name of ‘liberalised trade’, and in order not to ruffle the feathers of potential aid donors, they tolerate them. I mean, Ghana will be dealing with Britain’s DFID on a regular basis, probably with Mr Mitchell still at the head of DFID, and what would be the attitude of Mr Mitchell to aid requests from Ghana if Ghana’s vice-president had told him to go and jump when he asked for intervention on behalf of Armajaro, ‘with immediate effect’?

So Ghana’s arm was twisted – terribly – to positively assist a hedge fund company, when the company’s agent had been caught with his hand in the till. It is beyond belief. And there are reports that the matter will be raised by concerned MPs, in the House of Commons. But don’t lose much sleep over it. It will be papered over in the same way Britain always protects its erring companies, the best example of such practices being the unceremonious manner in which former prime minister Tony Blair stopped the attempt by the British Serious Fraud Office to prosecute the arms company, BAE Systems, for setting up a ‘sleaze fund’ amounting to billions of dollars, for the private use of Saudi royals, in respect of an arms contract called ‘al-Yamamah’.

Poor Anas Aremeyaw Anas! Did he realise what he was getting into? All that dangerous investigative journalism – and its results thrown away at a dinner table in London! If he had been suspected whilst unravelling the smuggling enterprise, he could have been seriously harmed. And what would it have been in aid of? To prove the point that the independence of African countries is meaningless, so long as their arms can be twisted by foreign governments on behalf of their erring companies, and – ‘with immediate effect’, too on top?

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