Cocoa Board signs US$1.3bn loan for 2018/19 purchases

Ghana Cocoa Board on Thursday signed a 1.3 billion dollar loan agreement with international banks to fund the purchases for the 2018/19 season, due to open in early October.

The loan agreement was signed in Amsterdam with 21 banks including Amro Bank, Bank of China, Standard Chartered Bank, Industrial and Commercial Bank of China and Ghana International Bank.

Mr Joseph Boahen Aidoo, the Chief Executive of Ghana Cocoa Board, said at the signing ceremony through live streaming from Amsterdam that the facility would be used to purchase at least 900,000 tonnes of cocoa from farmers.

He said COCOBOD would repay the loan over 12 months with an interest rate of Libor plus 0.625 per cent.

“By this event, Ghanaian cocoa farmers are going to be assured of fair and prompt payment for the fruit of their labour – that is cocoa,” he added.

He said the first half of the loan; 650 million dollars, would be received on October 4, while the final amount would be transferred in November.

Mr Aidoo said the facility was oversubscribed, when they made their roadmap in London, adding that some of the local banks involved in the syndicated loan were Ecobank, Barclays Bank, SG Bank and Standard Chartered Bank.

Mr Aidoo said with the facility, COCOBOD would be able to meet their obligation in the crop season.

He said the facility would not be able to address all the challenges confronting the cocoa sector, hence government was in talks with some of the banks to provide medium to long term financing facility to address those issues.

“We had some favourable conversations with some of the lenders to support with 300 million dollars to address the fundamental challenges in the sector,” he added.