The Minority leader in Parliament, Dr Cassiel Ato Baah Forson, alleges that international banks rejected the Ghana Cocoa Board’s (COCOBOD) loan request due to the poor health of cocoa beans.
He said for the first time in 32 years, international banks have rejected the COCOBOD request for a US$1.5 billion prepayment loan intended to finance the purchase of cocoa for the 2024/2025 crop year.
Cocoa production has drastically declined from 969,000 metric tonnes in the 2016/2017 crop year to just over 400,000 metric tonnes in the 2023/2024 season. This significant reduction in production has severely impacted COCOBOD’s ability to fulfil its contractual obligations.
The Minority Leader, in a statement obtained by The High Street Journal (THSJ), noted that in June 2024, COCOBOD issued a ‘Request for Proposal’ of US$1.5 billion loan to purchase up to 650,000 metric tonnes of cocoa for the 2024/2025 crop year.
“But this request did not attract any interest from the international banks due to the poor health of COCOBOD and the collapse of the cocoa sector under its present management,” he said.
He said from a production level of 969,000 metric tonnes inherited from the NDC in the 2016/2017 crop year, cocoa production has declined to just a little over 400,000 metric tonnes for the 2023/2024 cocoa season.
According to the Minority, the significant decline in cocoa production in the last eight years and the mismanagement of the cocoa sector have impacted COCOBOD’s ability to meet its contractual obligations.
The statement said COCOBOD is unable to supply about 250,000 metric tonnes of cocoa and has resorted to the rollover of this contractual obligation due to the poor management of the cocoa sector which has resulted in a significant decline in cocoa production under the current administration.
‘COCOBOD was chased away from the market because COCOBOD is no longer creditworthy and are unable to produce enough cocoa to meet their contractual obligations,’ it said.
“The banks came to the conclusion that out of the projected production of 650,000 metric tonnes of cocoa for the 2024/2025 crop year, which is doubtful, 250,000 metric tonnes will be used to service existing rolledover contracts, leaving only 400,000 metric tonnes to honour COCOBOD’s obligations for the 2024/2025 crop year. This raised the ability to pay questions for the banks, hence their refusal to participate.”
Furthermore, the statement from the Minority stated that for seven consecutive years, COCOBOD has recorded huge losses amounting to over GH₵11 billion under the Akufo-Addo/Bawumia government. The announcement by COCOBOD that it has taken a bold decision not to borrow from foreign banks to finance cocoa purchases after 32 years is false, unmeritorious, contrived and face-saving, the statement said.
This development, the Minority said “is to hide the fact that COCOBOD is no longer creditworthy and that a 32-year-old tradition, which has consistently cushioned and provided Ghana’s economy with the most reliable foreign exchange to support the Ghana Cedi, has been destroyed by the Akufo-Addo/Bawumia government.”
Dr Forson said Ghana’s cocoa sector is in crisis and needs urgent attention, competent management and a new direction alleging further that the NPP government has completely mismanaged and destroyed the cocoa sector.
“After seven years of decline in production and consecutive losses, the government has shown clearly that it does not have the competence to manage the cocoa sector which has since independence been the mainstay of the Ghanaian economy,” he said.
