THE INTERNATIONAL Cocoa Organization, the intergovernmental group representing the commodity’s leading producers and consumers, is considering relocating its headquarters from London to Ivory Coast, the world’s top grower.
The move to Abidjan, the capital of Ivory Coast, which accounts for more than 35 percent of global cocoa production, will represent a vote of confidence in the West African country less than a year after it emerged from a bloody civil war.
Since its inception in 1973, the ICCO has been headquartered in London, home to the benchmark NYSE Liffe cocoa futures contract. The relocation to Abidjan will be on the agenda at the organisation’s semi-annual meeting in Ecuador next week.
President Alassane Ouattara, who won the country’s elections in 2010 but only took full control of Ivory Coast last year after a power struggle with his predecessor, Laurent Gbagbo, is offering to house the ICCO in Abidjan rent free for ten years during which the organisation will build its offices in the capital.
Mr Ouattara has been pressing ahead with a reform of the cocoa sector, the country’s most important industry. The government has introduced forward-selling auctions of cocoa, aimed at improving price stability and guaranteeing its farmers a greater share of revenues.
Uncertainty surrounding the auctions, which started at the end of January, had contributed to volatility in the cocoa price in the latter part of last year. However, most large buyers have started to participate in the transactions. Cocoa prices plummeted below £1,300 a tonne at the end of last year in part due to concerns about oversupply of cocoa beans from West Africa. Since the start of 2012, they have mostly fluctuated between £1,450 and £1,550 a tonne.
Negotiations about moving the ICCO headquarters out of London to Abidjan have been on the cards for about a decade due to high London rents. However, the issue has remained up in the air due to years of civil war and security issues in the Ivory Coast, while countries including Ecuador and Ghana have also expressed interest in hosting the organisation.
Until a decade ago, Abidjan was a financial hub for West Africa, home to the headquarters of the African Development Bank. But since a civil war in 2002, international organisations and companies have steadily deserted the country.
The Ivorian government is also hosting the ICCO’s inaugural World Cocoa Conference, which will bring together the public and private sector involved in cocoa production and chocolate manufacturing in Abidjan in November this year.
Also on the agenda of next week’s meeting will be the selection of a shortlist for the next executive director. The term of the current acting executive director Jean-Marc Anga, an Ivorian, is due to end this year. Mr Anga succeeded Dutchman Jan Vingerhoets in 2010. Ft.com