In the early 1980s when the government fought hard to salvage the country�s cocoa sector from further bruises and revamp production to appreciable levels, it introduced a number of measures such as the Akuafo Cheque to replace the cash paid to cocoa farmers.
Under cash and carry, produce buying clerks bought cocoa beans from farmers using cash or cheques debited from the account of the agent (the institution the clerk is working for).
That mode of payment was, however, seen to be prone to abuse by the clerks, as most of the clerks either diverted the funds to their private accounts, bolted with the cash or issued dud cheques for payments.
The Public Affairs Manager of the Ghana Cocoa Board (COCOBOD), Mr Noah Amenyah, explained that the situation resulted in a loss of trust in the purchasing system, lack of motivation for farmers to produce more cocoa and a subsequent sharp fall in the output of cocoa beans to an average of 159,000 tonnes in the 1983/1984 cocoa season.
In the 1960s, cocoa production averaged 450,000 tonnes per year, data on COCOBOD�s website show.
While the purchasing clerks were busy enriching themselves, thanks to the loopholes in the system, cocoa farmers received less for their toil and only languished in hardship.
These forced the government to come out with the Akuafo Cheque System under which the clerks issued special cheques � the Akuafo Cheque � credited to a general account for cocoa farmers known as the Akuafo Account, in return for cocoa beans.
The said cheque was recognised by all commercial banks and later by the rural and community banks nation-wide. The cheques could, therefore, be cashed in any bank of the farmer�s choice.
At the point of presenting the cheque at the counter, the farmer also had the right to reserve some of the money in the Akuafo account but under his/her name to be taken later and that encouraged the farmers to save their proceeds.
Throughout the 1980s, the Akuafo Cheque Sytem became the only means for purchasing cocoa. It stopped the diversion of funds and issuance of dud cheques by produce clerks as pertained under the cash system to the overall benefit of the farmers, the sector and the country at large.
The farmers had value for their toil, most of them were encouraged to save part of their earnings to enable them to re-invest in their farms and eventually helped push annual cocoa yield up.
Farmers Confused Following the liberalisation of the cocoa sector in the 1990s, purchasing clerks managed to bring back the cash system to run concurrently with the Akuafo Cheque System which was initially seen to be the only means of buying cocoa.
COCOBOD�s public affairs manager told the GRAPHIC BUSINESS that the board allowed the two systems as part of efforts to liberalise the sector. �Some of the small-scale farmers also preferred the cash to the Akuafo Cheque and so we allowed both,� he said.
But as the days went by, the cash system pushed the Akuafo Cheque System aside and currently appears as if it was even the approved mode of payment for cocoa beans.
The clerks, it is believed, encouraged the cash system due to the advantages it provides them. The farmers are now calling on the government and the COCOBOD to order purchasing clerks into using only the Akuafo Cheque for cocoa.
That, they said will help them save and also prevent purchasing clerks and licensed buying companies (LBCs) from taking advantage of the system to enrich themselves.
�The Akuafo System was good. It helped us to save and go for loans to improve our operations,� the President of the Ghana Cocoa, Coffee and Shea-nut Farmers Association (GCCSFA), Alhaji Alhassan Bukari, said in a telephone interview.
�With the cash system, most of the farmers normally spend the money immediately they receive it and that doesn�t help the business. We know the Akuafo Cheque System is still in place but we want COCOBOD to tell the LBCs to use that one only,� Alhaji Bukari said.
COCOBOD�s loans and farmer interest While discussions on the farmers� appeal was taking shape, COCOBOD � the regulator of Ghana�s cocoa industry � on September 12 announced a pre-export deal worth US$1.5 billion to be used in purchasing cocoa beans in the 2012/2013 cocoa season.
The deal was made possible by a consortium of 31 local and international banks from Ghana, Europe, America and Asia. Although the Akuafo Cheque debate and the finance deal may sound unrelated, in reality they are not far apart.
As the Minister of Finance and Economic Planning, Dr Kwabena Duffuor, stated at the signing ceremony in Accra �the receivables-backed trade-finance is not backed by government guarantee but by the produce it seeks to support.�
�This has been made possible by the hard working cocoa farmers who always ensure that the produce is available for sale to pay back the loan,� the minister added.
In effect, if the system used in buying the cocoa does not favour the farmers, then most of them will not be motivated to produce more to enable COCOBOD repay the loans and earn the credibility it currently, has in the eyes of its international financiers.
It is, therefore, imperative on COCOBOD and the government to either order the LBCs into using the Akuafo Cheque alone to buy cocoa as demanded by the farmers or publicly tell the farmers and LBCs that the farmers have a right to choose between the cheque and cash methods of payment.
The environment must be created to favour the farmers as they are the lifeline of the country�s cocoa sector. Otherwise, COCOBOD�s long term ambition of displacing neighbouring Cote d�Ivoire as the global leader in cocoa production will continue to be a wild goose chase.
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