JICA, others provide $600m syndicated loan to COCOBOD

Ghana Cocoa Board (COCOBOD), Japan International Cooperation Agency (JICA) and other development finance institutions (DFIs) have announced a $600 million credit facility for COCOBOD’s Productivity Enhancement Programmes (PEPs).

It is the product of a syndicated receivables-backed loan facility deal signed in November 2019, by DFIs — including African Development Bank (AfDB), JICA, Development Bank of Southern Africa (DBSA) and Cassa Depositi e Prestiti Spa (CDP), and commercial finance agencies such as Credit Suisse AG (London branch), the Industrial and Commercial Bank of China (London branch) and other international agencies — with COCOBOD to boost cocoa production in Ghana.

The Chief Executive Officer of COCOBOD, Mr Joseph Boahen Aidoo, said: “As the second largest cocoa bean producing country in the world, Ghana fulfills a major part of supplying to the demand around the world. However, there are challenges with productivity of the country’s cocoa production, as well as with the systems in place for processing and the distribution of cocoa.

“By strengthening the cocoa bean-centric agricultural value chain and related industries, the finance will help COCOBOD to contribute to achieving Sustainable Development Goals (SDG) 1 (no poverty), 8 (decent work and economic growth) and 12 (responsible consumption and production).”

Official meeting

At a ceremony that complied with COVID-19 official meeting and social distancing guidelines, he further stated: “COCOBOD will use the facility to raise cocoa yields per hectare and increase Ghana’s overall production. These include financial interventions to sustainably increase cocoa plant fertility, improve irrigation systems, and rehabilitate aged and disease-infected farms. The funds will also help increase warehouse capacity and provide support to local cocoa-processing companies.”

The Chief Representative of JICA Ghana, Mr Yasumichi Araki, said: “At the seventh Tokyo International Conference on African Development (TICAD7) in 2019, JICA and AfDB agreed to provide $3.5 billion in joint financing under the fourth phase of the Enhanced Private Sector Assistance for Africa Initiative (EPSA4). This loan marks the first time JICA and AfDB will be providing direct co-financing under EPSA4 as well as first non-sovereign project.”

JICA’s contribution

“It is JICA’s hope that this loan facility will assist COCOBOD to implement the PEPs more efficiently and sustainably to meet its expected goals. Also that there will be increased yield of cocoa as cocoa farmers benefit from this nationwide programme,” Mr Araki added.

“More importantly, apart from JICA’s $100 million contribution to this syndicated loan, it is also considering another technical cooperation to COCOBOD to support the success of PEPs implementation.”

Ghana’s cocoa sector employs over 800,000 rural families, and produces crops worth about $2 billion in foreign exchange annually.