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The Colonial Office, British Business Interests and the Reform of Cocoa Marketing in West Africa, 1937–1945*

  • David Meredith (a1)

This article examines the actions of the British Colonial Office and British business interests in the international marketing of cocoa from Ghana and Nigeria in the later 1930s, when problems in cocoa marketing were brought to head by the expatriate firms forming a ‘Pool’ and the farmers responding to this — and to a sudden fall in their terms of trade — with a ‘hold-up’, which was followed by a British commission of inquiry, and during the second world war and immediate post-war era, when the C.O. imposed a marketing system designed by the expatriate merchant firms and subsequently decided to make it into a permanent peacetime reorganization. The close contact between the CO. and British firms such as the United Africa Company and Cadbury Bros. is brought out, as is the support given by the officials to these companies before and during the war. A further theme is a certain antipathy displayed by the officials for African capitalists in general and cocoa traders in particular and the way in which the war-time scheme squeezed African and other non-British small cocoa-export firms in many cases out of business.

The war-time scheme convinced the C.O. that a peacetime system of fixed buying prices which were set well below the world price was desirable as a means of eradicating ‘middleman abuses’ and of building up large ‘stabilization funds’ to protect the cocoa farmers in future years when prices might fall. Continuation of the scheme was thus seen as an act of trusteeship. It was also attractive to the British Treasury because it maximized U.S. dollar earnings for Britain from the sale of West African cocoa. In contrast to interpretations put forward by some other historians, this article argues that the Colonial Office had close, day-to-day contact with the leading British firms involved, that it strongly supported the ‘Pool’ system before and during the early stages of the war, and that the post-war marketing structure was an outcome of the war-time scheme and not of the Nowell Commission report of 1938. Finally, having lost in an unequal struggle with the expatriate firms and the Colonial Office between 1937 and 1944, African international shippers of cocoa were permanently excluded.

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1 Bauer, P. T., ‘Origins of statutory export monopolies of British West Africa’, Business Hist. Rev. XXVIII (1954), 205.

2 Meredith, David, ‘State controlled marketing and economic “development”: the case of West African produce during the Second World War’, Econ. Hist. Rev. 2nd ser., xxxix, I (1986), 7791.

3 Westcott, Nicholas, ‘The East African sisal industry, 1929–1949: the marketing of a colonial commodity during depression and war’, J. Afr. Hist. xxv, 4 (1984), 445–61;Palmer, Robin, ‘The Nyasaland tea industry in the era of international tea restrictions, 1933–1950’,J. Afr. Hist. XXVI, 2–3 (1985), 211–39.

4 Milburn, Josephine, ‘The 1938 Gold Coast cocoa crisis: British business and the Colonial Office’, Afr. Hist. Studies, III, I (1970), 72;Idem, British Business and Ghanian Independence (1977), 26.

5 Hopkins, A. G., ‘Big Business in African Studies’, J. Afr. Hist. XXVIII, 1 (1987), 129–30.

6 League of Nations, Journal of the Economic and Monetary Conference (London, 1933),60;C.O. to Foreign Office, 9 February. 1934, Public Records Office (London), CO. 323/1300/31925/34.

7 Minute by Eastwood, C. C., 24 September 1937, C.O. 852/67/15006/3/37.

8 Minute by Clauson, G. (Assistant Secretary, Colonial Office and Head of the Economic Department,) 27 November 1937, C.O. 852/67/15006/3/37.

9 C.O. 852/67/15006/3/37.

10 C.O. 85267/15006/3/37.

11 C.O. 852/67/15006/3/37.

12 On the Gold Coast cocoa hold-up see Miles, John, ‘Rural protest in the Gold Coast:the cocoa hold-ups, 1908–1938’, in Hopkins, A. G. and Dewey, Clive (eds), The Imperial Impact: Studies in the Economic History of Africa and India (London, 1978);Grier, Beverly C., ‘Cocoa marketing in colonial Ghana: capitalist enterprise and the emergence of a rural African bourgeoisie’, paper presented to the African Studies Association Conference, Los Angeles, 1979;Grier, ‘Cocoa, class formation and the state in Ghana’ (Ph.D. thesis, Yale University, 1979).

13 Minute by Fiddian, A. J. (Principal, Colonial Oflice), 5 Feb. 1931, CO. 96/696/ 6844/31.

14 The terms of trade have been calculated from trade statistics in Gold Coast, Blue Book, Trade Returns, 1928–1938.

15 Evening Standard (London) 24 Oct. 1937;Financial News (London) 30 Oct. 1937;The Times (London) 30 Oct. 1937.

16 Lord Trenchard, Chairman of U.A.C., telephoned Sir Cosmo Parkinson (Assistant Under Secretary of State) with news of the hold-up on 15 Nov. 1937, C.O. 852/67/15006/3/37.

17 C.O. to Gold Coast, telegram, 15 Nov.. 1937, CO. 852/67/25006/3/37.

18 CO. to Gold Coast, telegram (2),24 Nov. 1937, C.O. 852/67/15006/3/37.

19 C.O. to Gold Coast, telegram, 1 Dec. 1937, C.O. 852/67/15006/3/37.

20 Gold Coast to CO., telegram, 3 Dec. 1937, C.O. 852/67/15006/3/37.

21 Hodson to Ormsby-Gore, 11 Nov. 1937, CO. 852/67/15006/3/37.

22 Cadbury and Samuel to Trenchard, 3 Dec. 1937, C.O. 15006/3/37; notes of meeting between Messrs. Mellor and Knight (U.A.C,) and Sir Cecil Bottomley (Assistant Under Secretary of State) at C.O., 4 Dec. 1937, C.O. 852/67/15006/3/37.

23 Meeting, 4 Dec. 1937, C.O. 852/67/15006/3/37.

24 Notes of meeting between Cadbury and Trenchard and Ormsby-Gore, 7 Dec. 1937, C.O. 852/67/15006/3/37.

25 CO. to Gold Coast, telegram, 24 June. 1938, C.O. 852/133/15006/3/38.

26 Minute by Clauson, 5 June. 1938, CO.852/133/15006/3/38.

27 Notes of meeting between Samuel and Cadbury and Clauson, 18 Jan. 1938, CO. 852/133/15006/3/38.

28 Gold Coast to C.O., 28 June. 1938, C.O. 852/133/115006/3/38; Ormsby-Gore informed the Cabinet on 1 Feb.

29 U.A.C. to CO., 6 April. 1938, C.O. 852/133/15006/3/38.

30 Gold Coast to CO., telegram, 21 Apr. 1938, CO. 852/133/15006/3/38.

31 Notes of meeting between representatives of U.A.C. and Cadbury Bros., and C.O., 1 Sept. 1938; notes of telephone conversation between Mellor (U.A.C.) and Sir Henry Moore (Assistant Under Secretary of State), 6 Sept., C.O. 852/134/15006/3/38.

32 C.O. to Gold Coast, telegram, 12 Sept. 1938, C.O. 852/134/15006/3/38.

33 Report of the Commission on the Marketing of West African Cocoa, British Parliamentary Papers [hereafter B.P.P.J, 1937–1938, iX, Cmd. 5845, 191.

34 Gold Coast to CO., 1 Jun. 1939, CO. 852/192/15006/IF/39.

35 C.O. to Gold Coast, 31 Aug. 1939, CO. 852/192/15006/IF/39.

36 U.A.C. to C.O., 11 Sept. 1939, CO. 852/256/16015/39/1.

37 Minute by Lord Dufferin and Ava (Parliamentary Under Secretary of State for the Colonies), 21 Sept. 1939, CO. 852/256/16015/39/1;minute by Carstairs, C. Y., 6 May 1943, CO. 852/530/19875/9/1/43.

38 Sir Henry Moore to Lord Dufferin and Ava, 21 Sept. 1939, C.O. 852/256/16015 39/1;C.O. to Treasury, 19 Sept. 1940, CO. 852/319/18015/IK/40.

39 C.O. to Gold Coast and Nigeria, 23 Sept. 1939, CO. 852/256/16015/39/I,

40 Ibid.

41 First revised draft of control scheme, 18 Nov. 1939, C.O. 852/256/16015/39/3.

42 Memorandum by the Association of West African Merchants, 3 Nov. 1939, C.O. 852/256/16015/39/2.

43 Ibid.

44 Coddington and Lamb Ltd. to CO., 29 Dec. 1939, C.O. 852/256/16015/39/4.

45 Minutes of third meeting of Gold Coast Cocoa Committee, 23 Dec. 1939, C.O. 852/ 256/16015/39/4.In the Gold Coast, Sir Nana Ofori Atta demanded 50,000 tons for ‘B’ shippers: Ghana National Archives (hereafter G.N.A.), C.S.O. 506/39/SF3.

46 U.A.C. to CO., 29 Nov. 1939, C.O. 852/256/ 6015/39/3.

47 Gold Coast to C.O., 29 Dec. 1939, C.O. 852/318/18015/1/40.

48 C.O. to Leventis, 16 Oct 1940, C.O. 852/318/18105/1H/40.

49 G.N.A., C.S.O. B.F.0001/114 (1940).

50 Gold Coast to C.O. 16 Jun. 1940, C.O. 852/318/18015/1/40.

51 C.O. to Gold Coast., 20 Mar. 1940, C.O. 852/318/18015/11/40. See also the case of G. D. Egremont, whom the Gold Coast Government supported, G.N.A., C.S.O. 506/ 39/SF2O/ 1940.

52 Ibid

53 Nigeria to CO., 27 Nov. 1939, C.O. 852/256/16015/39/3.

54 Minute by Williams, O. G., 5 Mar. 1940, C.O. 852/318/18015/1D/40.

55 Minute by Melville, E., 4 May 1940, C.O. 852/318/18015/1/40.

56 Minutes of meeting of W.A.C.C.B., 12 Sept. 1940, C.O. 852/319/18015/1M(i)40.

57 C.O. to Gold Coast, 1 Sept. 1940, C.O. 852/318/18015/IK/40.

58 Ibid.

59 Minute by Melville, 19 Sept. 1940, CO. 852/318/18015/1K/40.

60 Minute by Melville, 12 Jun. 1940, C.O. 852/318/18015/1K/40;Governor Hodson expressed similar sentiments in March 1940, G.N.A., B.F. 0028/1/40.

61 Melville to Caine, 10 Feb. 1941, C.O. 85/444/18015/IH/41.

62 Minute by Caine, 3 Jun. 1941, CO. 852/444/18015/1H/41.

63 Minute by Caine, 1 Dec. 1941, C.O. 852/444/18015/ID/41.

64 Ibid

65 Tansley to Miles, 4 Jun. 1941, CO. 853/4/18015/1D/41.

66 Minute by Williams, 28 Nov. CO. 852/444/ 18015/1D/41.

67 Minute by Henlen, 1 Dec. C.O. 852/4/18015/1D/41;Cocoa Association of London to C.O., 23 Dec. CO. 852/445/18015/1K(3)42.

68 Colonial Secretary, Gold Coast to Melville, 18 Jul. C.O. 852/445/18015/IK/41.

69 Tansley to Henlen, 8 Jun. 1942, C.O. 852/445/18015/1K(3)42.

70 W.A.P.C.B. Paper No. 21, 10 Sept. 1943, CO. 852/512/19601/43.

71 Minutes of meeting between Gerard Creasy, Eric Tansley and representatives of the Gold Coast Government, Accra, 13 Jun. 1944, C.O. 852/595/19601/9/44.

72 CO. to Gold Coast and Nigeria, Aug. 1943, C.O. 852/445/18015/1K/41;C.O.memorandum, Oct. 1943, C.O. 852/525/19760/43. See also: Bauer, P. T.. West African Trade: A Study of Competition, Oligopoly and Monopoly in a Changing Economy (Cambridge, 1954); Bauer, ‘Origins of the statutory export monopolies’; Meredith,‘State controlled marketing’.

73 Accumulated cocoa profits stood at £37 millions at the end of the 1942–1943 season; the U.S.A. took 39 per cent of the cocoa sold by the Board in 1942–1943, but profit per ton on U.S. sales was £12.3.4d compared to £6.5.od per ton on sales to the Ministry of Food (Report on Cocoa Control in West Africa 1939–1943 and Statement of Future Policy(B.P.P.1943–1944, iii, 153, Cmd. 6554); W.A.P.C.B., C.O. 852/525/19760/74/1/43).

74 CO. Memorandum, 10 Oct. 1943, CO. 852/525/19760/43.

75 Cadbury to Creasy, 6 Mar. 1945, C.O. 852/596/19601/9/7/PT2/45.

76 Cadbury to Ministry of Supply, 13 Mar. 1942, C.O. 852/318/18015/G1/42.

77 Minutes of meeting between Secretary of State for the Colonies and the Association of West African Merchants Cocoa Sub-Committee, 15 Nov. 1944, C.O. 852/596/19601/ 9/7/44.

78 Joint Provincial Council to Gold Coast Government, 26 Jun. C.O. 852/596/19601/9/7/PT2/45 see also, Echo, Daily, 26 Oct. 1945 and Gold Coast Independent, 28 Oct. 1945.

79 Minute by Creasy, 1 Jul. C.O. 852/596/19601/9/7/PT2/45.

80 Minutes of a meeting between Cadbury Bros., Frys, Rowntrees, C.W.S and Lyons and Creasy, 21 Sept. 1944 C.O. 852/595/19601/9/44.

81 Gold Coast to C.O., 9 Oct. C.O. 852/596/19601/9/7/44.

82 Nigeria to C.O., 13 May 1944, C.O. 852/595/19601/9/4/44.

83 C.O. to Gold Coast, 10 Dec. 1945, C.O. 852/596/19601/9/7/PT3/45.

84 For example, Clauson met Samuel at the Savoy Hotel on 12 Jun. 1938 (Samuel told him he thought the hold-up would soon end), and in October 1938 the Secretary of State gave a dinner party for ‘leading personalities’ of the U.A.C. (Minute by Clauson, 13 Jun. 1937, C.O. 852/133/15006/3/38; note by Eastwood, 18 Oct. 1938, CO. 852/134/15006/3/38).

85 Some years previously Hodson (as Governor of Sierra Leone) was in trouble at the Colonial Office over the gift of a diamond to Lady Hodson from Consolidated African Selection Trust Ltd., which was in negotiation with the Sierra Leone Government for diamond-mining rights. (CO. 267/642/2094/1933; this incident is also discussed in Kaniki, Michael, ‘Economic change in Sierra Leone during the 1930s’, Trans-African Journal of History, III, I-II (1973), 7295.)

86 Wickizer, V. D., Coffee, Tea and Cocoa: An Economic and Political Analysis (Stanford, 1951), 324.

87 W.A.C.P.B. Policy Paper No. 7, 24 Nov. 1942, C.O. 852/533/3/42.

88 CO to Gold Coast and Nigeria, 1 Dec. 1939, CO. 852/256/16015/PT3/39.

89 Minute by Clauson, 11 Sept. 1940, CO. 852/318/18015/1K/40.

90 Nigeria to C.O., 13 May 1944, CO. 852/595/19601/9/4/44.

91 Gold Coast to C.O., 11 Feb. 1945;Nigeria to C.O., 15 Feb. 1945, C.O. 852/596/19601/9/7/45.

92 CO. to Gold Coast and Nigeria, 22 Nov. CO. 852/596/19601/9/7/PT3/45.

93 Ibid.

* I wish to thank the Dean of the Faculty of Commerce, University of New South Wales, for financial assistance to research in connection with this paper.

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