A total of 25 banks and 66 bidders took part in this year’s cocoa purchases loan arrangement with Ghana Cocoa Board (COCOBOD), Chief Executive Officer (CEO) Joseph Boahen Aidoo has said.
COCOBOD realised $1.3 billion from the syndicated loan facility to buy cocoa beans for the 2017/2018 crop season at an interest of 0.65 percent.
The signing ceremony, which took place in Paris, France on Wednesday, marked the 25th anniversary of Ghana’s engagement in soft commodity financing on the international market.
Mr Aidoo, who addressed the media in Accra Wednesday via a telephone interview from Paris shortly after signing of the deal, described it as one of the best interest rates.
There was oversubscription of the loan this year to the tune of $2.4 billion, but Cocobod opted for only $1.3 billion, taking into consideration the anticipated volume of 850,000 metric tonnes of cocoa to be produced in the 2017/2018 season.
Ghana collected $1.8 billion during the 2016/2017 crop season and was able to repay a month earlier before the repayment deadline, which was August 2017.
The CEO described Cocobod as a ‘first class borrower,’ saying the ability of the West African country to consistently repay its cocoa loans has boasted confidence among the participating banks.
Mr. Aidoo indicated that the first tranche of the loan amount shall hit Bank of Ghana’s account by the second week of October 2017 and repayment shall begin by February 2018.
The Coordinated Initial Mandated Lead Arrangers for the 2017/2018 facility, BUSINESS GUIDE gathered, include Rabobank, Credit Agricole Corporate & Investment Bank, Natixis, Standard Bank, Sumitomo Mitsui Banking Corporation and Ghana International Bank.
The loan is expected to support over 800,000 cocoa farm households and tens of thousands in the ancillary industries.
The cocoa sector accounts for 4.5 percent of Gross Domestic Product (GDP), and contributes about 25 percent of Ghana’s merchandize export earnings, according to statistics from COCOBOD.
Mr. Aidoo assured all the 25 banks involved in the syndication that Cocobod would meet its obligations under the current loan agreement and would take steps to enhance the assignments, collections and repayment processes associated with this facility.
“We do assure the entire world that contrary to some negative media reportage on cocoa from West Africa sub-region, Ghana’s cocoa is “clean cocoa,” and remains the premium cocoa and the benchmark of measuring the standard of cocoa in the world,” Mr. Aidoo said.
Asked whether there would be increment in producer price this year, the CEO indicated that would be difficult to see an increment in that regard, considering the fall in world cocoa price from $3,000 to $1,900.
Present at the signing ceremony in Paris were Ghana’s Ambassador to France, Cocobod Board Chairman, Hackman Owusu, other officials of COCOBOD and Ministry of Finance and the Ghana Cocoa Marketing Company.
By Melvin Tarlue