For the first time in 32 years, international banks have rejected Ghana Cocoa Board’s (COCOBOD) request for a prepayment loan to finance the purchase of cocoa, Dr Cassiel Ato Baah Forson, the Minority Leader, has disclosed.
In a statement copied to the Ghana News Agency, Dr Forson noted that in June 2024, COCOBOD issued a Request for Proposal of $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.
“From a production level of 969,000 metric tonnes inherited from the National Democratic Congress (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.”
Dr Forson said the significant decline in cocoa production in the last eight years and the mismanagement of the cocoa sector had impacted COCOBOD’s ability to meet its contractual obligations.
“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 significant decline in cocoa production under the New Patriotic Party (NPP) Government,” he stated.
“COCOBOD was chased away from the market due to the fact that COCOBOD is no longer credit worthy, lacks credibility and are unable to produce enough cocoa to meet their contractual obligations.”
Dr Forson reiterated that clearly, the banks concluded that out of the projected production of 650,000 metric tonnes of cocoa for the 2024/2025 crop year, which was doubtful, 250,000 metric tonnes would be used to service existing rolled-over contracts, leaving only 400,000 metric tonnes to honour COCOBOD’s obligations for the 2024/2025 crop year.
The Minority Leader said this raised the ability to pay question for the banks, hence their refusal to participate.
He said for seven consecutive years, COCOBOD had recorded huge losses amounting to over GHS 11 billion.
The Minority Leader said the announcement by COCOBOD that it had taken a bold decision not to borrow from foreign banks to finance cocoa purchases after 32 years was false, unmeritorious, contrived and face-saving.
He said this was to hide the fact that COCOBOD was no longer credit worthy and that a 32-year-old tradition, which had consistently cushioned and provided Ghana’s economy with the most reliable foreign exchange to support the Ghana Cedi, had been destroyed by the government.
Dr Forson said Ghana’s cocoa sector, which was in crisis, needed urgent attention, competent management, and a new direction.
He said: “The NPP Government has completely mismanaged and destroyed the cocoa sector”.
He said after seven years of decline in production and consecutive losses, the Government had shown clearly that it did not have the competence to manage the cocoa sector, which had since independence been the mainstay of the Ghanaian economy.
Source: GNA
