Government misapplying Cocoa Syndicated loan – Minority

The Minority in Parliament has accused government of misapplying the first tranche of the Cocoa syndicated loan released in October.

According to the Minority, the first tranche of $650 million was diverted in other areas instead of financing the operations of Licensed Buying Companies (LBCs).

“The Minority is however very disappointed that the funds have not been used for the intended purpose but rather diverted into areas that will not benefit the cocoa farmer in anyway. A statement issued by PBC Limited on the 22nd November 2018 indicated that about GHC104 million of cocoa taken-over receivables (CTORs) due LBCs has not been paid,” the minority said in a statement Monday.

The statement further said: “The Minority is however very disappointed that the funds have not been used for the intended purpose but rather diverted into areas that will not benefit the cocoa farmer in anyway. A statement issued by PBC Limited on the 22nd November 2018 indicated that about GHC104 million of cocoa taken-over receivables (CTORs) due LBCs has not been paid”.

Below are details of the statement;

MISAPPLICATION OF THE FIRST TRANCHE OF THE SYNDICATED LOAN FACILITY

1. The Minority in Parliament has noted with concern that the first tranche of the US$1.3 billion cocoa syndicated loan for the 2018/19 crop year has not been used for the intended purpose. The first tranche of $650m cocoa loan syndication has been released and was received by the Bank of Ghana on the 6th October 2018.

2. As part of measures to ensure that Licensed Buying Companies (LBCs) have adequate funds to promptly pay cocoa farmers, part of the first tranche of $650m of the US$1.3 billion facility was supposed to be used to finance the smooth operations of Licensed Buying Companies (LBCs), especially, Produce Buying Company (PBC). The rationale for this policy direction is to ensure that the ordinary cocoa farmer is paid on time.

3. The Minority is however very disappointed that the funds have not been used for the intended purpose but rather diverted into areas that will not benefit the cocoa farmer in anyway. A statement issued by PBC Limited on the 22nd November 2018 indicated that about GHC104 million of cocoa taken-over receivables (CTORs) due LBCs has not been paid.

4. The recent findings from the work of the Center for Socioeconomic Studies (CSS) has revealed that COCOBOD has either refused, neglected or failed to allocate funds to the Licensed Buying Companies (LBCs), especially, Produce Buying Company.