International Cocoa Initiative studies reveal cash transfer program for farmers has key impacts

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According to Neill Barston, the results of a “cash transfer” program to help cocoa farming in Ghana revealed that communities benefited from direct additional financial support, which reduced the number of cases of labor children.

Research on the International Cocoa Initiative’s West Africa initiative found that the move – involving payments of around $30 a month for households in the region – has helped families during difficult times of the pandemic.

The study would be the first of its kind to measure the impacts of direct cash assistance and the first of its kind to measure the impact of a cash transfer program for cocoa farmers on child labour. As noted earlier, among the main ways to combat child labor have been measures to help increase school enrollment rates for children in the region.

Notably, the cash transfer follows other industry initiatives to help cocoa farmers in the region, including Nestlé’s recently announced revenue accelerator project, as well as government support in Ghana and in Côte d’Ivoire to establish direct “living income differential” payments to communities at a rate of $400 per tonne in crops in the sector.

As the Swiss non-profit organization’s research recorded, its findings involve collecting data from more than 600 families in the Brong-Ahafo and Eastern Regions of Ghana who received transfers. money for six months. She looked at the effects of the cash transfer of about $30 per month on households and children.

The project was partly funded by an innovation grant from the Swiss Secretariat for Economic Affairs (SECO) under the Swiss Platform for Sustainable Cocoa (SWISSCO). Increased ability to cope during difficult times Research shows that cash transfers have made households more resilient to unexpected adverse events.

As the studies revealed, two-thirds of the households involved in the study experienced an illness, death in the family, crop failure or some other type of shock, which negatively affected their financial situation. Moreover, the results show that the families who received the cash transfers were better able to cope with these unforeseen events. Households not receiving cash transfers were much more likely to resort to negative coping strategies, such as reducing family food consumption or resorting to child labour.

Yaw Donkor, a farmer from Sankoré, was one of the beneficiaries of the cash transfer programme. His story is a good example of the consequences of sudden illness. “I was seriously ill,” said Yaw, who was unable to work for several months. “I had some problems with my eyes…without the money, I have no idea how my children and I would have survived this period.”

Reduction of child labor Cash transfers reduced child labor by 9 percentage points – this corresponds to a substantial decrease from a prevalence rate of 58% in the sample. The study also showed that cash transfers had a positive impact on the material well-being of children, with children in households receiving the transfers being more likely to own essential items such as blankets, shoes and clothing. “The results of this study are very encouraging. Regular cash transfers helped protect children during a difficult time when many families were struggling to make ends meet. During the six-month pilot project, child labor decreased significantly.

These results demonstrate the important role of income in combating child labour, but also that it cannot solve the problem on its own – even after the program the prevalence of child labor 2 remained relatively high at around 50 %. Income support should be part of a wider package of measures to prevent and combat child labour. explained Matthias Lange, Executive Director of ICI. Support at a particularly difficult time The study took place during the Covid pandemic, which posed additional difficulties for most households.

Farmers reported declining income from small businesses, barriers to accessing markets, and difficulties in finding affordable adult labor. In times of heightened vulnerability like this, social protection systems are vital. “Cash transfers are a form of social protection that has been shown to lead to positive outcomes for children and families.

In times of heightened vulnerability, such as during the pandemic, they are particularly important in preventing households from resorting to negative coping strategies like child labor,” explained Megan Passey, Knowledge and Learning Manager at ICI. . “During the design of the project, we consulted experts from LEAP – Ghana’s National Cash Transfer Program who provided valuable feedback on the design of the project,” she added. Avoiding unintended negative consequences A growing body of evidence shows that cash transfers generally have positive effects on child well-being, but careful design is important to avoid negative effects.

Other studies show that in a small number of cases, cash transfers can lead to an increase in child labour, especially when the money has been used to create new business activities that have increased the need for labor. artwork. This pilot project provided cash transfers in the form of regular monthly payments, rather than a lump sum to encourage investment in daily needs. The program also included raising awareness of the dangers of child labor and the importance of investing in the well-being of children.

Further research is needed to better understand the impact of other design considerations, such as transfer size, timing, and who receives it. It will also be important to study the longer-term effects. Program design Over 600 cocoa-growing households in two farmers’ societies in Ghana were randomly assigned to a study or control group. Prior to the start of the study, a baseline survey was conducted. Study group households received monthly cash payments over a 6-month period via mobile money.

These were adjusted for the number of children in the household and capped at GHS 228 ($35) per month. A second survey of all households was then conducted to measure the impact. After that, households in the control group also received six monthly payments of the same value, minimizing any negative impact related to equity and community cohesion. This impact study was carried out as part of an innovation project partly funded by the Swiss State Secretariat for Economic Affairs (SECO) as part of the Swiss Platform for Sustainable Cocoa (SWISSCO). ICI implemented the cash transfer program, in partnership with ECOM.

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