Background: Similarities between Ghana and Côte d’Ivoire

Background: Similarities between Ghana and Côte d’Ivoire

The timing of the wager was appropriate because the economic systems of Ghana and Côte d’Ivoire were comparable in 1957. Both countries were fundamentally colonial economies with roughly the same levels of product and market concentration. Cocoa accounted for about 60 percent of Ghana’s export, and gold and timber contributed a significant proportion of the rest. In Côte d’Ivoire, coffee accounted for 60 percent of exports, and cocoa and timber contributed a significant proportion of the rest. In terms of both market concentration and source of imports, Ghana was oriented towards Britain and Côte d’Ivoire was oriented towards France. Lawrence Alschuler (1988: 68) identified three key elements of Côte d’Ivoire’s economic system: production concentration (coffee, cocoa and wood, representing 87 percent of the region’s production); trade-partner concentration (with France as the main market destination); and a vertical system within the international division of labor. The same has been said of Ghana at independence (World Bank, 1960: 4).

In the late 1950s, Ghana and Côte d’Ivoire were the most successful British and French colonies in Sub-Saharan Africa. Côte d’Ivoire grew a little faster than Ghana at the time of their leaders’ wager in 1957, due to its late conversion to a colonial economy (Amin, 1973: 54). To elaborate on this: despite becoming a colony in 1893, Côte d’Ivoire only acquired a colonial economy in the post-1945 era. Several scholars (Amin, 1973: 50; Zolberg, 1960; Green, 1971: 235; Tuinder, 1978: 14; Campbell, 1978: 68-70) have divided the economic and political history of Côte d’Ivoire into the periods before and after the Second World War. Before 1946, the region’s economic regime was characterised by compulsory cultivation and forced labour, controlled by France (Cooper, 1996: 118). Local producers were forced to cultivate certain products to provide raw materials for French industries (see Basset, 2000: 51-85). The colonial authorities also sought to develop the colony through the activities of European settlers, who were encouraged to settle in Côte d’Ivoire after the First World War. They owned plantations producing coffee and later cocoa, and were supplied with labour as part of an unpaid labour service scheme that operated as a form of tax (Amin, 1973: 50). The program of forced cultivation implemented before 1945 failed to transform the colony. As soon as forced labour ceased, cultivators stopped farming the colonial product. This was most noticeable in the cases of cocoa and cotton (Basset, 200: 51-85). Social changes after 1945 led to the abolition of methods such as forced labour and compulsory cultivation in the colonies (Campbell, 1978: 74). The post-1945 era was the beginning of Côte d’Ivoire’s modern history.

A law passed on April 5, 1946 suppressed forced labour, extended citizenship to all subjects of Côte d’Ivoire and abolished the discriminatory legal code. France began to invest massively in Côte d’Ivoire to support the indigenous production of coffee and cocoa, rather than enforcing compulsory cultivation. All of the economic, political and social institutions operating in the region after 1945 were created to support the post-1945 plantation economy. The growth of Côte d’Ivoire’s economy during the 1950s was unprecedented, due to the change in colonial policy in 1945. Throughout the 1950s, the region grew by 7-8 percent per year (Amin, 1973: 50), and became the most successful French colony in West Africa in 1956, after overtaking Senegal. With the post-war expansion of commercial agriculture, the area of Côte d’Ivoire’s farmland increased massively.

Côte d’Ivoire’s late conversion was not replicated in Ghana. Samir Amin observed that the economic system in 1960s Ghana had been in place as early as 1914 (Amin, 1972: 42). The early transition of Gold Coast (the name of the country before independence) to a colonial economy was due to Britain’s initial emphasis on the local cultivation of cocoa. Gold Coast became a major producer of cocoa in the 1920s. Production increased significantly after the First World War, and peaked at 310,000 tons in 1936. By the late 1940s, planters were facing problems. The increase in commodity prices in the post-war years did much to conceal these problems (as replanting demands considerable investment). Between 1947 and 1950, the price of cocoa more than doubled (Kay, 1972: 359). Between 1936/40 and 1951/55, the nominal value of cocoa increased more than sevenfold, while the real value increased almost threefold. In the same period, cultivation increased by only 15 percent. The money price of cocoa increased from £18 per ton in 1935 to £200 per ton in 1948, and to £400 per ton in 1954 (World Bank, 1957: 5). Crucially, Côte d’Ivoire had a slight production advantage over Ghana during the late 1950s due to its late conversion to a colonial economy and abundant uncultivated forestland. The amount of available forestland has an important influence on cocoa/coffee cultivation, because forest is a production factor for planters of both crops (Clough et al., 2009: 198). The abundant forestland in Côte d’Ivoire in the late 1950s has been likened to that of Gold Coast of 1914 (Green, 1971: 235; Amin, 1967). Nevertheless Ghana and Côte d’Ivoire were virtually similar at the time of the wager.

At the time of the leaders’ wager, despite Nkrumah’s anti-colonial stance and unremitting advocacy of structural change, industrialisation and diversification, there was no effort to diversify after independence (Fitch and Oppenheimer, 1966: 82). Nkrumah initially employed Arthur Lewis, an expert in economic development, to advise his government on the question of industrialisation (Brainard and Perry, 2004: 224). Lewis advised against any hurried decision to industrialise, as cocoa was lucrative.¹⁴ In essence, Nkrumah’s government followed Houphouet-Boigny’s position on continuity—that is, continued to promote cocoa exportation— after the wager. It was until the commodity crisis of 1961 threatened his position and induced the government of Ghana to undergo diversification, designed for the political survival of ruling elites.