Processes to access US$600m AfDB Cocoa loan still ongoing

The processes that will pave way for release of a US$600 million syndicated loan facility from the African Development Bank (AfDB) aimed at developing Ghana’s cocoa sector are still on going.

Both parties – AfDB and the Ghana Cocoa Board (COCOBOD) – have indicated that very soon, the various processes will be completed by both sides to facilitate the loan’s release.

This was revealed last Thursday in Accra during a four day visit to Ghana by the Executive Directors of the Bank who were in the country to engage with government, private sector representatives, as well as trade and industry stakeholders on the impact of AfDB’s projects being undertaken in Ghana.

In November 2019, officials of COCOBOD together with representatives of the AfDB officially signed the US$600-million loan agreement in South Africa during the 2nd edition of the Africa Investment Forum.

The loan is expected to be used specifically to undertake various interventions in the cocoa sector including rehabilitation of moribund farms, fighting the cocoa swollen shoot disease, building warehouses as well as establishing a cocoa famer database as part of a cocoa management system.

Currently, the total portfolio value of the Bank’s projects being run in Ghana is estimated to be around US$900 million, in various sectors of the economy which include agriculture, infrastructure, and capacity building among others.

Addressing the media, the Dean of Executive Directors of the AfDB, Mr. Bright Okogu noted that the projects in Ghana that are being financed by the Bank and other developmental partners are progressing positively, further affirming that Ghana’s macroeconomic fundamentals such as inflation have now improved.

“Normally, when we come on these visits, we get a sense of how things are going in various sectors, notably macroeconomic stability issues and we are impressed”, Mr. Okogu said.

Key Highlights

Already, through its own resources, COCOBOD has begun rehabilitating diseased and over-aged cocoa farms across the country.

This forms part of strategic and long term measures in a bid to increase the country’s production of cocoa which currently stands at around 800,000 tonnes per annum to an estimated 1.5 million tonnes in the next five years.

Currently, it is estimated that Ghana has more than 2.5 million hectres of cocoa areas of which about 1.45 million hectres are considered to be productive areas.

Again, processes are underway establish a Cocoa Management System. The move is in anticipation of commencing the implementation of several new, farmer-focused, initiatives by October this year.

One of such initiatives requires that all cocoa farmers across the country be registered into a single database, and will issue them with electronic accounts into which all sales proceeds of their cocoa beans will be recorded and deposited with payments made electronically.