The Ghana Cocoa Board (COCOBOD) has signed a $1.8 billion syndicated loan for the 2016/2017 farming season.
The signing ceremony, streamed live to journalists in Accra, was witnessed by Deputy Minister of Finance, Cassiel Ato Forson in Frankfurt Germany on Wednesday.
The loan facility comes with an all-inclusive rate of 1.468 percent, representing an increment over the 2015/2016 loan.
A total of 24 banks were involved in this year’s transaction, with the lead arrangers being Deutsche Bank AG, Natixis, Nedbank Limited of South Africa, Societe Generale, the Bank of Tokyo-Mitsubishi UFJ Limited and DZ Bank.
A domestic bank, Fidelity Bank Ghana Limited, was part of the syndicate that raised the loan.
COCOBOD, in the 2015/2016 crop season, initially took a syndicated loan of $1.8 billion.
It later went for a top-up of $200 million loan, putting the total loan for 2015/2016 at $2 billion.
COCOBOD succeeded in repaying the loan by August, this year, paving the way for the 2016/2017 loan.
COCOBOD thus is entitled for another top-up amount of $200 million as happened in 2015.
This year marks the 24th time COCOBOD has entered the international market to take a loan for the purchase of cocoa beans and other related issues.
The loan has a four months’ moratorium and a seven months repayment scheme which starts in February 2017, according to Noah Amenyah, Public Relations Officer (PRO) of COCOBOD, who addressed the media in Accra after the signing ceremony in Frankfurt.
Parliament of Ghana approved up to $2 billion loan for the 2016/2017 crop year.
The 2016/2017 crop season, according to Chief Executive Officer (CEO) of COCOBOD, Dr. Stephen Opuni, who addressed the banks, begins in October, this year.
The cocoa production target for the 2016/2017 season ranges between 850,000 and 900 metric tonnes, after failing to meet the production target for the 2015/2016 season due to “climate change.”
Ghana produced a total of 740,000 metric tonnes in 2014/2015 farming season and total production for 2015/2016 is expected to exceed that amount.
The syndicated loan arrangement has existed between the banks and COCOBOD since 1992.
Dr. Opuni announced that the Board will try to add 500,000 hectares of new cocoa farms over the next 10 years through interventions as free cocoa spraying and fertilizer distribution to farmers.
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