COCOBOD raises $600m to defeat Cocoa Swollen Shoot Virus disease, (CSSV), and double annual production to 1.5 million tonnes
At an event held in the Dutch Embassy to celebrate Cocoa Day, COCOBOD’s CEO Mr Joseph Aidoo, told the attendees that Ghana’s production should be almost double the 800,000 tonnes they produced in 2019/20, to reach 1.5 million tonnes.
The Cocoa industry has been plagued with the devastating impact of the Cocoa Swollen Shoot Virus disease. Close to 20 per cent of the productive Cocoa area in the country has been affected by this disease.
Joseph Aidoo, CEO COCOBOD
Mr Aidoo then claimed the virus was, in fact, the villain responsible for farmer poverty. He said:
This has led to low productivity and low incomes for cocoa farmers. He continued.
Ghana is likely to move to 1.5 million tonnes of cocoa, and if that is going to happen, it means that service providers will have to expand their base.
Joseph Aidoo, CEO COCOBOD
I suspect that some farmers will be surprised to learn that CSSV, is what has held them back from doubling production.
The problems of the Cocoa Swollen Shoot Virus disease aside, productivity is low for numerous reasons. A significant one is that the government has yet to overhaul the unhelpful laws surrounding tree and land tenure, making it unattractive for farmers to invest in cutting back old trees and replanting.
In fact, if the country were to double their production in the conveniently vague “medium-term” communicated, it would inevitably be the result of additional deforestation, as this level of increase, in such a short time frame could only come from geographic expansion and not productivity improvement.
Or perhaps there is another explanation? Well, to fund this ambitious project, a financial consortium has made a $600m loan facility available, over a seven-year term.
Ghana’s government is a bit cash strapped at the moment. Revenues from exports are down, and inflation is moderate at 5.7%.
Even with the government’s economic support program, the fiscal deficit is expected to remain high. As a result, despite the projected decline in 2021, the deficit will still exceed Ghana’s 5 per cent cap by 2023.
It will be interesting to see if the government will release their plans on how to invest this $600m in defeating the disease, or whether the funds are quietly diverted to other, more general areas.
