Revenue from cocoa exports continued to decline in the first half of 2024, with earnings falling by 47.4% to $760.0 million from $1.45 billion in the same period in 2023, according to the Bank of Ghana. This downturn underscores the ongoing struggles in Ghana’s cocoa sector, which has faced challenges after the 2020/2021 crop season when production slightly exceeded one million tonnes. Current projections indicate that production volumes for the 2023/2024 season may fall below 500,000 tonnes.
In the first quarter of this year, the cocoa sector experienced negative growth of 20%, with export earnings dropping by 49% compared to the same period in 2023. The decline in production has prevented Ghana from capitalizing on the unprecedented rise in cocoa prices. This shortfall has also led to a shortage of processed cocoa products, such as cocoa powder, chocolate, and other confections, as processing companies struggle to secure enough cocoa beans.
To address these issues, the Cabinet is set to release a comprehensive plan to improve the Ghana Cocoa Board (COCOBOD) by the end of July 2024, according to an International Monetary Fund (IMF) report. This initiative aims to restore COCOBOD’s financial stability through enhanced financial oversight, a review of cocoa pricing to ensure fair profit distribution to farmers, cost-cutting measures, and the phasing out of funding for cocoa roads and fertilizer programs.
Despite the decline in cocoa exports, Ghana’s economy has been bolstered by high earnings from gold and oil. In the first half of the year, gold exports increased by 46.4% to $5.04 billion, while earnings from crude oil exports rose to $2.0 billion from $1.7 billion in the same period last year. This increase in gold and oil revenues has helped Ghana achieve a trade balance surplus in the first half of the year.
The improved trade surplus, alongside higher remittance flows resulted in a higher current account surplus of US$1.28 billion in the first half of the year, compared to a surplus of US$863.0 million in the same period in 2023.
