Gcse Geography Ghana Case Study

Ghana and trade

The problem with the cocoa trade

One major problem for cocoa growers is that the price they get for their crop is so low. The average income for a cocoa farmer is only about £160 a year. This is because of the way in which primary commodities such as cocoa beans are traded on the world market. Traders in Europe buy cocoa beans on the London Stock exchange. They shop around and buy the beans from whichever supplier is cheapest. I's a buyer's market. If Ghana's farmers are asking too much for their beans the buyers will shop around and buy from the Cote d'Ivoire or whoever is cheapest. The price can go up or down from day to day, depending on supply and demand. The fluctuating price makes it very difficult for farmers in Ghana to earn a fair wage for all of their work.

Almost 90% of all of Ghana's cocoa is grown on smallholdings: tiny farms that are smaller than 3 hectares in size. About 2.5 million smallholders in Ghana grow cocoa as their main crop. Most of the cocoa is sold for export; only about 5% of Ghana's cocoa crop is processed into chocolate in Ghana.

Currently about 75% of Ghana's cocoa beans are exported to the European Union. The main importing countries are the Netherlands, Germany, Belgium and France. The beans are ground into cocoa powder in these countries. Some of this powder is then exported to other EU countries where the chocolate is made.

The main producers of chocolate are in Belgium, Germany, Ireland, the UK and Austria. The production of cocoa beans goes up and down from year to year. Production depends on a number of factors such as weather conditions, pests and diseases. The production has fluctuated over a ten-year period.

Most cocoa beans are processed into cocoa powder before being used in the manufacture of chocolate. When the demand is higher than supply the price for cocoa beans export is high. 

Map of Ghana


What problems does Ghana have? – Poverty in Ghana

Ghana has many problems, the video below summarises the problems of one woman from Northern Ghana.


Video 2 - What does the video show about life in Northern Ghana?

There is a long history of problems in Ghana, despite large resources of cocoa, gold and diamonds.  Historically, the Portuguese were the first people to arrive in Ghana in 1471, they found gold and the name “the Gold Coast” was given to the area.  By 1650, the next major industry developed – slavery.  Over 100,000 people a year were bought from the Gold coast and transported across the Atlantic to work on plantations in the Caribbean.  The British occupied Ghana as a colony in 1901, and used it a s a base to ship gold, metal ores, ivory and cocoa.  This long history of exploitation by foreigners left Ghana very poor, so when independence was declared in 1957 the country faced huge problems.  These have had a long lasting legacy, coupled with current problems of debt repayments and desertification. 

In northern Ghana  many areas are at risk of becoming desert, this is because the savanna is too heavily used because of chopping down trees and overgrazing by cattle, and natural causes such as increased drought and wind erosion.  The end result is soil erosion and desertification.

Ghana is also over reliant on Cocoa – when the price fell it left Ghana with a shortage of income.  Ghana has also borrowed a lot of money, and rising debt repayments are difficult for the country to deal with.

The map below shows a clear trend, the North of Ghana has serious problems with poverty.

Indeed, although there has been an overall decline in poverty in Ghana, poverty still has a firm grip on rural areas, especially in the north. There is a wide gap in income between people living in the drought-prone northern plains, and those living in the south, where there are two growing seasons and greater economic opportunities.

Just over half of the country’s population lives in rural areas. The poorest parts of Ghana are the savannah regions of the north (the Northern, Upper East and Upper West regions), where chronic food insecurity is widespread and livelihoods are more vulnerable. Poor rural people have limited access to basic social services, safe water, roads that are accessible year round, and electricity and telephone services. Poverty is most severe among food crop farmers, who are mainly traditional small-scale producers. About six in ten small-scale farmers are poor, and many are women. Women bear heavy workloads. In addition to their domestic chores, they are responsible for about 60 per cent of agricultural production. More than half the women who head households in rural areas are among the poorest 20 per cent of the population. (Source)


The video reveals what life is like for the rural poor in and around the town of Tamale in Northern Ghana.  What challenges do these people face and what would it be like to live there?

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