Tax Evasion by Cocoa Agents in Ghana

COCOBOD’S “COCOA AGENTS” EARN MORE THAN $10 MILLION A YEAR AND DO NOT PAY ANY TAX.

I heard of the terms “cocoa agent” and “cocoa tycoon” in my days in the university as a student when we stayed close to one “cocoa tycoon or agent” in Tantra Hill, Accra. I was surprise at the first instance to see a “cocoa agent” so rich and powerful considering the status of cocoa farmers. I tried hard to enquire a bit more about what the jobs of the tycoons entailed in a bid to reshape my future dreams. But hard as I tried, I did not come to any meaningful conclusion but the feeling that the cocoa business in Ghana was very closed and highly secretive.

Five years after leaving school, I move to Lagos, Nigeria to work with a freight-forwarding firm. In there, I made friends with some European cocoa merchants, who have business interest with the Ghana Marketing Cocoa Board. It was in there that I understood the business of “cocoa agents or cocoa tycoons” in Ghana. In the words of my friend who worked for a French firm in Nigeria; being a “cocoa agent” in Ghana is simply the most lucrative tax-free job anywhere in the world. Even without any further details, I was convinced because of my earlier queries back in the days of Tantra Hill near the Catholic University.

Simply put, “Cocoa agents” in Ghana are simply faceless individuals who represent their principals’ interest by influencing their friends, relations, cronies etc in the Cocoa Marketing Board to sell cocoa to their principals at favorable terms. They need not operate a registered office or carry any overhead of staff. What is required is the ability to influence business terms in their principals’ favour. In return they receive something in the region of $10 - $20 for every tonnage of cocoa purchased as commission. So, for 1 million tons of cocoa that Ghana is producing, the “cocoa agents or tycoons” could make between $10million - $20million a year. The best part is that, this juicy amount of money goes tax-free because it remitted into different local, foreign or offshore accounts. Besides the ethical bit relating to tax evasion and also influencing public officers to act outside the law, being a “cocoa agent” in Ghana is truly the best business anywhere in the world.

Few weeks after these conversations, I inquired from my friend whether or not I could return home to Ghana and become a “cocoa agent” for his parent company or any other company in Europe? His answer was a coded “NO”, inferring that “cocoa agent” business is very closed and controlled by a few group who have friends, relations and also serve as god-fathers of the cocoa dealers in Cocoa Marketing Board. He was blunt to mention how connected their present Ghanaian “cocoa agent” was to the key people who do the transaction, which include his own son or nephew. Interesting! Then he quickly asked what ethnic group my family name “Barnieh” originate from in Ghana? I was curious about why an European asked such a question but he mildly remarked on how ethnicity matters in this type of business in Ghana as in parts of Africa. I was rather frightened by his statement that; this “cocoa agents” are quite a powerful force who almost operate like a mafia. They influence politics, policies and structure of the Cocoa Marketing Board itself. It was hard to believe in the sense that Cocoa Marketing Board is a government organization, but for the kinds of money involved, everything is possible. Mafias everywhere are dangerous and can do anything to protect their turf. For the sake of my life, I gave up on my ambition and after a thorough reflection, I decided to write this piece to encourage the Ghana Revenue Authority and the Minister of Commerce take steps to identify these faceless people and to collect the much needed tax revenue from the billionaire “cocoa agents”. The Minister of Commerce should take steps protect the national purse from the actions of “cocoa agents or cocoa tycoons”.

By Rudolf Barnieh Esq.

Rudbarn@live.com