Prez. Akufo-Addo injects $600m into cocoa sector

• Posted on November 4, 2019
• by Nana Kwesi Coomson
• Comment

President Nana Akufo-Addo’s government acting through COCOBOD is injecting a whopping $600 million stimulus package into the cocoa sector.

The money is being injected into the sector through cocoa productivity enhancement program.

The move is aimed at stimulating growth in the cocoa industry, rising cocoa production to over 1.5 million tonnes by 2027.

The stimulus spans about seven years period and will look at issues like rehabilitation of plantation, improvement in storage and domestic processing.

The fund is being provided by the African Development Bank and is expected to be approved by Cabinet after which officials of COCOBOD would travel to South Africa to start efforts towards the drawdown of the amount.

It is a medium term facility and marks the first time Ghana is moving away from annual syndication loan to a higher medium to long financing.

It is in two parts namely a commerical part and developmental part.

Information Minister, Kojo Oppong Nkrumah, made this known to the media on Sunday, November 3, 2019.

He was speaking at the end of Cabinet’s 64th regular meeting and 7th retreat held at the Peduase Lodge from Thursday October 31, 2019 to Sunday 3, 2019.

According to him, “the stimulus will target rehabilitation of plantations, improvement in storage and domestic processing, stimulation of local consumption as well as efforts to increase output on farms among others and spans a 7-year period.”

The Administration believes that Cocoa, being a major pillar of our economy cannot be allowed to survive at its own pace, he said.

“Cocoa farmers who have been the backbone of the Ghanaian economy already have good news for 2020 in cocoa price structure but now get an additional dose through this stimulus package,” the Minister added.

Chief Executive of Ghana COCOBOD, Joseph Boahen Aidoo, observed that upon assumption of office, President Akufo-Addo tasked COCOBOD to look at critical areas of the cocoa industry, especially production and financing of the industry.

He recounted that over the last two and half years, President Akufo-Addo and his Ivorian counterpart have initiated a number of programmes to enhance cocoa production and generate better prices.

Two important outcomes have emerged from the initiatives have been Living Income Differential and Terminal Price

Now Ghana is no more the taker of price; Ghana and Cote Ivoire are givers of price, he said.

Ghana at the moment, he said, was producing around 850,000 to 900,000 metric tons of cocoa per annum.

Ghana is expected to earn about $360 million by the end of the year from just the Living Income Differential alone. According to him.

If it should continue over the next 10 years, Living Income Differentials alone will be giving Ghana $3.6 billion.

The Living Income Differentials, he stressed, is the greatest thing to ever happen to Ghana.

The Chief Executive also pointed out the transformation of the sector under the President Akufo-Addo’s government.

He said the Akufo-Addo’s came to meet 480 kilos per hectare per farmer, which claimed was the lowest in the world.

Annual production he said was also round 750,000 metric tons under the Mahama’s administration when the ruling New Patriotic Party took over power in January 2017.

He said the President encouraged to find the most Sustainable way to improve the fortunes of the sector, leading them to being introduced to the African Development Bank for the loan.

He said the annual syndication loan cannot be used for capital projects, hence the move to get a medium to long term loan.

About $140 million, he said, is required to deal with the issue cocoa swollen shoot disease.

Additional funds are to be used to deal with the issue overages cocoa trees, according to him.

BY Melvin Tarlue & Daniel Bampoe