The Ghana Cocoa Board (COCOBOD) signed a syndicated loan agreement of US$1.3 billion on Tuesday, 29 September, to purchase cocoa beans and financing other operations of the board in the 2020/2021 crop season.
A syndicated loan is offered by a group of lenders who work together to provide credit to a large borrower. The borrower, in this case is COCOBOD. Each lender in the syndicate contributes part of the loan amount, and they all share in the lending risk. The loan involves a party of 28 local and international banks and financial institutions, including ABN Amro, Standard Chartered and Bank of China, which is repayable in seven equal monthly installments beginning February 2021 and ending August 2021.
COCOBOD expected purchases of 900,000 tonnes for the 2020/21 season from 1 October 2020 to 30 September 2021 – a boost from the highest record of about 800,000. The Chief Executive Officer (CEO) of COCOBOD, Mr Joseph Aidoo expressed optimism that the measures put in place by the government, coupled with the scientific approach adopted by farmers in growing the crop, will lead to higher yields.
Aidoo explains, as soon as money is received, cocoa farmers are assured of receiving physical cash at all COCOBOD contracted agents’ sales points throughout the country when the season is opened in October 2020.