The Ghana Cocoa Board (COCBOD) has secured a $1.8 billion loan facility for the purchase of cocoa beans from farmers for the 2016/2017 crop season.
When the cocoa plants perform better and require further funds, the arrangement allows for an additional $200 million to rack up the figure to $2 billion.
The facility comes with an all-inclusive rate of 1.48 per cent, with a four-month moratorium and a seven-month repayment period which could commence in February next year.
The amount which was raised by a consortium of 24 banks mostly from Germany, was over-subscribed by $640 million.
It comes on the back of an earlier one secured for the 2015/2016 farming season which was settled last month.
Signing the deal in Frankfurt, Germany, yesterday, the Chief Executive of the COCOBOD, Dr. Stephen Kwabena Opuni, said the facility would ensure that farmers in Ghana received prompt payments for their produce.
He mentioned the decline in soil fertility, ageing cocoa farmers, overaged cocoa farms, lack of interest for the youth to venture into cocoa farming, climate change, cocoa diseases among others as the key challenges in Ghana’s case.
According to Dr Opuni, the board, with the support of the government “is making frantic efforts to support our cocoa farmers to address these challenges”.
As measures to address these challenges, Dr. Opuni told the consortium in Germany that, free fertiliser was being distributed to the farmers to improve soil fertility, basic education of cocoa farming was being given to them, hybrid cocoa seedlings were being distribution to replace aged plants amongst others as the interventions to control the tide of decline in cocoa production.
“All these interventions are aimed at sustaining productivity in order to improve upon cocoa yield. This productivity package has also attracted and motivated over 400,000 young men and women to engage in cocoa farming.
“These initiatives are expected to add another 500,000 to 750,000 metric tonnes of cocoa after the next 10 years to our current yield,” he projected.
The Cococbod boss was confident Ghana would achieve its production target of 850,000 metric tones for the 2016/2017 cocoa season which begins next month.
Dr. Opuni assured that Ghana would not default in repayment of the loan as it has done since it first embarked on such deals in 1992.
“I wish to assure you that this loan, as usual, will be repaid on schedule so we can maintain our enviable record as one of the most credible borrowers in sub Saharan Africa,” he stated.
The consortium was pleased to have signed the deal with Cocobod for the track record it has showed over the years in respect of the cocoa syndicated loan facility.
It expressed its readiness to continue working with the board for mutual benefit.
By Julius Yao Petetsi