On Tuesday, 29th September 2020, Ghana Cocoa Board signed a US$1.3Billion syndicated loan agreement with some international and local banks.
This is the first time in the country’s history, that Ghana Cocoa Board signed a US$1.3 billion loan agreement virtually due to the Coronavirus Pandemic. The syndicated loan comes with an interest of 1.75% signed with 24 international banks and 4 local banks.
The international banks include Standard Chartered Bank, Amro Bank, Bank of China Limited in London, Industrial and Commercial Bank of China and Ghana International Bank, Cooperative Rabobank, and Societe General.
The four local banks include Stanbic Bank Ghana Limited, Ecobank Ghana Limited, Societe Generale Ghana Limited, and Absa Ghana Limited. Mr. Joseph Boahen thanked the institutions for their unrelenting support to the operations of the country’s cocoa industry and assured the institutions of the repayment of the loan on time.
“We have also returned this trust by ensuring that we never defaulted in repaying the loans since the 1992/1993 crop season when the first one was signed. We have on several occasions repaid the loan ahead of schedule. The 2019/2020 syndicated loan, for instance, was re-paid two months ahead of schedule,”
The loan is expected to be repaid in seven (7) months.
He also assured the institutions of channeling the funds solely to its intended purpose. “I wish to assure all stakeholders that the loan will be used solely for the purpose for which it has been contracted,” he said.
What the loan offers
According to the CEO of Ghana Cocoa Board, Mr. Joseph Boahen, the loan facility will be used to purchase at the very least 900,000 metric tonnes of cocoa from farmers. This together with the Living Income Differential pricing mechanism introduced by Ghana and Cote d’Ivoire which brought about a $400.00 addition to the price of every tonne of cocoa will improve the livelihoods of farmers and stimulate their increase in cocoa output to hit the target of producing one (1) million metric tonnes.
The CEO stressed in addition to the above, his outfit “ will successfully implement the Productivity Enhancement Programmes and other interventions such as the National Cocoa Rehabilitation Programme, Hand Pollination Programme, Mass Pruning Exercise, Mass Spraying Exercise, Free Seedlings Distribution, Subsidized Fertilizer Distribution, and the Cocoa Roads Improvement Initiative, to ensure a sustainable cocoa economy and improved socio-economic livelihood for our cherished farmers.”
President Akuffo Addo’s Commitment
On Thursday, September 24, 2020, President Akuffo Addo announced from October 1, a new producer price of GH¢10, 560 per metric tonne for the 2020/2021 crop season which translates to GH¢660 per bag of cocoa will take effect. This is to enable the country to shore up its cocoa output and return the country to the days of producing one (1) million metric tonnes of cocoa.