ICI publishes timely report on ‘unexpected shocks’ in cocoa farmers’ incomes as countries fight coronavirus

A new report ‘The effects of income changes on child labour: a review of evidence from smallholder agriculture​’ published by the International Cocoa Initiative (ICI) examines evidence of the impact of unexpected shocks that either increased or decreased incomes, as well as the effects of policies and programmes to increase household incomes.

The analysis of 50 studies shows a complex relationship between income change and child labour: while decreases in household income tend to increase child labour, increases in household income can cause child labour to rise, as well as to fall.

Global economic crisis

These new findings, developed in partnership with the Swiss Cocoa Platform and the Swiss State Secretariat for Economic Affairs (SECO), are particularly relevant in the context of the coronavirus pandemic and the related global economic crisis underway which is expected to cause smallholder farmers and their livelihoods to suffer.

The findings from report reveal “that there is a serious risk of increased child labour as a result of the current crisis​”.

Nick Weatherill, ICI’s executive director, told ConfectioneryNews: “We urge all actors to double-down on efforts to protect and assist poor rural households and their children at this critical time, and to explore ways of further adapting ​their work, so they can continue to make a difference under these new and challenging circumstances​."

While efforts to combat Covid-19 need to be led by governments and their national and  international partners with public-health expertise, the ICI said it welcomed supportive actions from the cocoa and chocolate industry that ‘include leveraging their strong relationships with cocoa-growing communities to share information on how to fight transmission of the virus and distributing emergency supplies. The cocoa sector is also providing financial support to organizations delivering humanitarian aid and emergency support.’

We urge all actors to double-down on efforts to protect and assist poor rural households and their children at this critical time, and to explore ways of further adapting ​their work, so they can continue to make a difference under these new and challenging circumstances -- Nick Weatherill, ICI executive director​

The ICI said it has also acted and is using its strong presence in communities to provide information about Covid-19 whilst continuing to raise awareness on the heightened risks of child labour through community representatives.

Poverty reduction

It currently supports 221,000 children in its ongoing child labour prevention and remediation work and said: “The evidence from this review also shows that income increases alone are not a silver bullet to solve the problem of child labour. While poverty reduction needs to be part of the solution, it is crucial we use this evidence on the different impacts of income changes on child labour to avoid adverse effects. Only through careful design and robust evaluation of policies and interventions to increase farmer incomes, can we ensure they also support reductions in harmful work by children​.”

The ICI’s own analysis​ suggests that the Covid-19 crisis is likely to lead to increased economic pressure on poor agricultural families, with a likely negative impact on household incomes. Farmer illness, higher food prices, lack of access to school feeding for children, and possible disruptions to the supply of fertilisers and pesticides (all possible impacts of the current situation), would all place increasing pressure on farmer incomes which, for many cocoa farmers, are already below the poverty line.

It says its recent research confirms that when incomes are negatively impacted, child labour tends to increase. One example from Côte d’Ivoire showed that a 10% fall in income, due to a drop in cocoa price, led to a 5 percentage point increase in child labour​.

In addition, school closures (currently in force in Ghana and Côte d’Ivoire) are also likely to lead to a rise in child labour, as they did during the the Ebola crisis​, since children are expected to work more when schools are closed.

Key findings

Key findings in the new joint study show the relationship between income changes and child labour is complex and the effects are not unidirectional. Out of 16 studies that examined negative shocks, 13 found unambiguous increases in child labour.

Examples from Tanzania and India show that if earning opportunities decrease, for example in times of droughts, or due to the absence of adult supervision, even if there is more poverty, child labour can also fall.

The study looked at the effect of a positive shock, which depends on the context and mediating factors such as asset ownership. Out of 11 studies that examined positive shocks, only four found unambiguous reductions in child labour. Studies in which positive shocks caused child labour to increase include two of price rises in Brazil and two examples of increased rainfall in India and Tanzania.

Overall, the findings concerning positive incomes shocks indicate that when the value of agricultural activities increases, there is a potential risk that child labour will increase as well, the study concluded.