The Ghana Cocoa Board (COCOBOD) will fund the procurement of cocoa beans and its domestic operations for the first time in thirty-two years.
With effect from the 2024–2025 cocoa season, the decision eliminates the need for the yearly syndicated loan to finance local bean purchases.
“After 32 years of going for loans offshore to buy cocoa beans, we have taken a bold step not to go for syndicated loan for the 2024/2025 cocoa season,” Chief Executive of the COCOBOD, Joseph Boahen Aidoo, told a news conference in Accra on Tuesday.
“We want to wean ourselves off offshore funding and be self-financing. Thirty-two years is enough to learn lessons and we have and we think it is time to wean ourselves from offshore funding,” he insisted.
He stated that neither investor disinterest in the syndicated loan nor desperation drove the move.
According to Mr. Aidoo, Ghana would save US$150 million in interest payments on the yearly syndicated loan by funding the acquisition domestically.
“We are looking for US$1.5 billion this crop season and looking at the interest rates last year, which were over eight per cent, plus the cost, it means that we can save more than US$150 million by the decision not to go offshore,” he said.
When asked about the source of money, Mr. Boahen replied that information would be shared when appropriate.
He stated that the forthcoming cocoa season, which starts in September, would be a turning point for the COCOBOD because it plans to buy 650,000 tonnes.
According to Mr. Aidoo, the COCOBOD’s operations are guided by the welfare of cocoa farmers and the national interest, and all of its decisions are made with those goals in mind.
In light of this, Mr. Aidoo stated that the COCOBOD has put in place a number of efforts to deal with the issues impeding the expansion of the cocoa industry.
In his list of measures, he mentioned the Cocoa Rehabilitation Program, which has affected over 40,000 hectares of cocoa farms nationwide, as well as productivity-boosting initiatives including mass cocoa spraying, trimming, and hand pollination.
Even if the industry is facing difficulties, he claimed that predictions that it will fail in five years were exaggerated and did not accurately reflect the situation on the ground.
“We urge stakeholders to support our efforts and work together to address the challenges facing the sector.
“The negative reports circulating in the media (that the sector will collapse) are not only inaccurate but also disregard the extensive efforts and investments being made to secure the future of the industry,” he stated.
According to a statement released by the Minority in Parliament’s leader, Dr. Cassiel Ato Forson, foreign banks turned down COCOBOD’s $1.5 billion loan request because they were worried there wouldn’t be enough cocoa on hand to meet both new and ongoing commitments.
It stated that the rejection resulted from the severe decline in cocoa production, which dropped from 969,000 metric tonnes in 2016–17 to just over 400,000 metric tonnes in 2023–2024, as well as COCOBOD’s dire financial situation.
It alleged that poor administration caused COCOBOD to default on pledges for 250,000 metric tons of cocoa and cast doubt on the organization’s capacity to pay debts.
According to the statement, COCOBOD has suffered losses of over GH¢ 11 billion under the current administration. The company’s assertion that it has avoided taking out foreign loans was interpreted as an attempt to conceal the dire situation facing Ghana’s cocoa industry and its deteriorating creditworthiness.
Source: newsthemegh.com