Ghana Cocoa Board (COCOBOD) has signed a US$1.5billion Pre-export Syndicated Finance agreement with a consortium of local and international financial institutions to finance cocoa purchases for the 2021/2022 Cocoa Season.
The facility, which was contracted at a competitive interest rate plus LIBOR of 1.10%, a marked improvement upon last year’s 1.75%, will also be used to finance operational activities within the crop season. The signing ceremony for this year’s facility took place at the Headquarters of the Standard Chartered Bank, Ghana Plc in Accra.
In his virtual welcome address, the Chief Executive of COCOBOD, Joseph Boahen Aidoo, expressed gratitude to the financial partners for their trust in Ghana’s cocoa industry for which reason they are willing to fund the operations of the industry.
“The support we have received from our financial partners has been very consistent and enormous. Management of COCOBOD sincerely appreciates your unflinching commitment in these difficult times,” he noted.
According to Hon Aidoo, despite the challenges that the cocoa industry faced as a result of the Covid-19 pandemic, the country was able to achieve its target of significantly increasing productivity per hectare, leading to the attainment of a record high production at the end of the 2020/21 crop season.
“I wish to officially inform stakeholders that through our continued implementation of the Productivity Enhancement Programmes (PEPs), at the close of the 2020/21 crop year, cocoa beans purchased stood at one million and forty-five thousand five-hundred metric tonnes (1,045,500mt), breaking the 10-year-old record set in the 2010/2011 crop year which was 1,024,526mt,” he stated.
He expressed confidence in a “blissful future” for Ghana’s cocoa industry and invited all stakeholders along the value chain to challenge themselves to achieve greater milestones in the coming season.
Hon. Owusu Afriyie Akoto, the Minister for Food and Agriculture, in a statement at the event, said Ghana’s cocoa industry has served as an icon of good corporate governance in the sub-region and has remained vibrant because of its continued partnership with relevant stakeholders across the globe. He commended the Management of COCOBOD for the prudent leadership of the cocoa sector, especially, in the past couple of difficult years.
The Minister assured the consortium of banks that put together the US$1.5 billion amount that the facility would be fully committed to its intended purpose, which is to ensure prompt payment to farmers for their produce at the buying centres.
Speaking on behalf of the lenders, Mrs Mansa Nettey, the Chief Executive Officer of Standard Chartered Bank, Ghana Plc, said the financial institutions remain committed to a continuous beneficial relationship with COCOBOD.
She said the facility received commitments in excess of US$1.7billion due to COCOBOD’s impeccable credit profile and market relationships.
A total of 28 institutions, made up of 4 local and 24 international financial institutions participated in this year’s syndication facility. She mentioned the Initial Mandated Lead Arrangers as Standard Charted Bank, Industrial and Commercial Bank of China, Coöperatieve Rabobank, MUFG Bank Ltd, Natixis, Nedbank Ltd and Ghana international Bank. The four local banks are EcoBank Ghana Limited, Standard Chartered Bank, Société General Ghana Limited and Absa Ghana Limited.
The facility is expected to be repaid in seven (7) equal instalments, from February to August 2021.