MINICASE CHOCOLATE: IS YOUR TREAT THE RESULT OF UNFAIR LABOR AND THE EXPLOITATION OF CHILD LABOR?

When you last indulged in a bar of rich chocolate, a cup of hot cocoa, a piece of chocolate cake, or a scoop of chocolate ice cream, did you know that you may have been consuming a product made in part by child slaves? Forty-six percent of chocolate originates in the Côte d’Ivoire (Ivory Coast), which produces nearly twice as much cocoa as the second-largest producer, Ghana. Overall, 75 percent of the world’s cocoa is sourced in Côte d’Ivoire and Ghana, West Africa. According to Anti-Slavery International, 284,000 children work in hazardous conditions, and up to 15,000 of them are held as slaves, victims of human trafficking, in Côte d’Ivoire.

Chocolate is one of the most heavily traded agricultural products in the world. The top 10 chocolate-consuming nations are the United States and countries in Western Europe. In usual practice, beans from different nations are mixed together during their export from West Africa and transported to processing plants in the importing nations. So essentially all the chocolate treats regularly enjoyed by hundreds of millions of consumers are likely to include cocoa from the Côte d’Ivoire.

A survey on child labor in West Africa found that two-thirds of workers were under the age of 14. Working conditions were described as slavery-like, with many child workers in the Côte d’Ivoire indicating that they were not free to leave their place of employment. Many had been brought into the cocoa-growing areas from distant regions including poverty-stricken countries such as Burkina Faso, Mali, and Togo, often after being kidnapped. Some were sold by their parents in expectation that the child’s earnings would be sent home. Although paid less than 60 percent of the rate of adult workers, children frequently worked for more than 12 hours per day, 6 days a week, and were regularly beaten. More than half applied pesticides to crops without the benefit of protective gear. Only 34 percent of the children working on cocoa farms went to school, which was about half the level for children who were not working on cocoa farms. The rate of school enrollment was even lower for girls. These child laborers seemed to be trapped in a vicious cycle: forced into work due to kidnapping or economic circumstances faced by themselves and/or their families, they earned subsistence wages, and because most had not been to school and had minimal skills, their prospects for seeking other employment were limited.

Source: http://www.foodispower.org/slavery_chocolate.php

Efforts to raise awareness of the exploitation of child labor in the cocoa industry face great challenges. Even today, a majority of consumers seem unaware of the circumstances behind the production of chocolate. Meanwhile, the farms have become increasingly secretive and no longer allow visitors.

Some important cocoa-producing nations have worked with the International Labor Organization and the International Programme on the Elimination of Child Labour (IPEC) to establish national programs to eliminate child labor in their countries. However, evidence suggests that child labor continues to be a widespread problem in Côte d’Ivoire and Ghana. Industry representatives have complained that progress toward eliminating child labor in cocoa production has been hindered by traditional culture in the agriculturally based producing nations, compounded by civil war and other complications.

In the absence of prompt and effective action by the chocolate and cocoa industry, a number of companies have begun producing Fair Trade–certified chocolate. By observing a strict set of guidelines associated with Fair Trade certification, these companies can guarantee that their chocolate products are ethically sourced. Fairtrade Labelling Organizations International established certification standards. This group pays subsidies to farmers in developing countries, ensuring that those certified as engaging in fair-trade practices will receive a price for their produce that will at least cover their costs of production. By providing a price floor, fair-trade practices protect Third World farmers from global fluctuations in commodity prices that result from trade practices. At the same time, Fair Trade certification requires that farmers engage in appropriate social, labor, and environmental practices, such as paying livable wages and not using child or slave labor. In addition to the cocoa program, Fair Trade certification programs have been implemented for a range of other products, such as coffee, tea, and crafts.

Already, more than 50 companies make Fair Trade chocolate products in the United States, including ClifBar, Cloud Nine, Newman’s Own Organics, Scharffen Berger, and Sweet Earth Chocolates. A recent course at Harvard College taught by anthropologist Carla Martin helps explore these issues. You can check out her blog at http://bittersweetnotes.com/.

Questions:

1- Should labor practices in another country be a relevant consideration in international trade? Why or why not?

I think that labor practices in another country must be a relevant consideration I international trade. There are several reasons for this relevant consideration. For example international market may not always be stable. When you consider labor practices in advance in a foreign country that you operate in or plan to operate in, you would be better prepared for the labor related problems and risks. Trade unions play an important role in the smooth operations of a firm which can only be handled when you have considered the labor practices.

2- With regard to trade in products such as cocoa, what options are available to governments, businesses, and consumers for dealing with practices such as child labor or slave labor in other countries? What are the implications associated with each of these options?

What government can do is establish a fair price for products like cocoa. This will ensure a fair trade of chocolate. The consumers would not then be abused with unrealistic prices. Governments can also play an important role in ensuring that businesses do not exploit child labor or engage in slave laboring. Government can ensure this with tough laws and penalties. Businesses also need to realize their ethical responsibilities. Consumers need to boycott the businesses who engage in unethical practices like child laboring.

3- How would international trade theorists view the Fair Trade movement?

It primarily depends on the ideology and political affiliation of a trade theorist to view fair trade movement from a certain angle. Those who are more liberal would want the fair trade movement to do more while conservatives would see it as something already crossing certain trade limits.