Finance Minister Dr. Mohammed Amin Adam has refuted recent claims made by the CEO of Ghana Cocoa Board (COCOBOD) about self-financing the upcoming 2024/2025 cocoa crop season.
Speaking during a monthly economic update in Accra today, August 29. Dr. Adam clarified that the government will seek external funding to support the cocoa sector, contrary to COCOBOD’s earlier announcement.
The board had previously announced plans to transition to self-financing for the 2024/2025 cocoa crop season, which begins in September 2024.
According to Joseph Boahen Aidoo, COCOBOD’s Chief Executive Officer, this shift was expected to save approximately $150 million.
However, Dr. Adam indicated that the government will instead depend on syndicated loans and other financial instruments to secure the necessary funds for the season.
He noted, “I want to take this opportunity to clarify that as part of measures to improve the financial viability of COCOBOD, the government for the 2024/2025 crop season will be sourcing funds through the syndication process and other alternative sources.”
Background To Cocobod Story
COCOBOD had lastweek described the Minority’s claims that international financiers, have rejected requests for syndicated loans and consequently expelled it from the market. They described the claims as misleading and factually incorrect.
They maintained that the decision to reduce reliance on syndicated external borrowing is a strategic one aimed at bolstering its operations and finances.
The statement clarified that the syndicated banks had, in fact, responded positively to COCOBOD’s Request for Proposals (RFP).
“Indeed, notwithstanding our intentions to wean off syndicated transactions, we still have committed contracts that need to be fulfilled through the syndicated process. These transactions have necessitated a discussion with financial institutions, and nothing in this process indicates, to us, a lack of confidence in COCOBOD’s creditworthiness from these financial institutions,” portions of the statement read.
Mr. Joseph Boahen Aidoo highlighted that its move towards exploring non-syndicated funding is a key element of a broader plan to diversify its financial resources. He said , the initiative is aimed at enhancing the long-term sustainability of COCOBOD and ultimately providing greater benefits to cocoa farmers.
He also used the opportunity to refute the minority’s claim of continuous losses, specifically denying the alleged GHȼ4.2 billion loss in 2023.
Dismissing the Minority’s claim that the government has “destroyed” the cocoa sector, the board has reaffirmed the government’s commitment to the cocoa sector. They cited investments in infrastructure, subsidised fertilizers, and a comprehensive cocoa rehabilitation program as evidence of ongoing support.
