Ghana seeking US$1.3 billion loan financing approval for purchase of cocoa in 2020/2021 season

GHANA – The government of Ghana is seeking for a Parliamentary approval to borrow US$1.3 billion loan financing, for the purchase of cocoa in the 2020/2021 crop season.

An additional GHS6.5 million in tax waivers has also been presented to the house, reports Ghana Web.

In 2019 the government signed a US$1.3 billion loan for the purchase of some 850,000 metric tonnes of cocoa beans from farmers for 2019/2020 crop season.

The amount was a cocoa syndicated loan signed between Ghana Cocoa Board (COCOBOD) and some international financial institutions.

The new tabled request follows the regulator of cocoa, COCOBOD given the strongest assurance that its annual cocoa syndication loan facility will go ahead despite the COVID-19 pandemic.

The sector is currently in line to benefit from a US$600 million-dollar loan facility from the African Development Bank.

COCOBOD officially launched the US$600 million syndicated loan facility in June to finance key components of the organisation’s productivity enhancement programmes.

The loan facility aims to implement production, warehousing and processing interventions, adding value to Ghana’s cocoa sector.

Mr Joseph Boahen Aidoo, CEO of Ghana Cocoa Board, speaking at the launch revealed that the organization has received the first tranche of US$200 million out of the US$600 million cocoa syndicated loan facility.

According to a statement by COCOBOD, the institutions providing the funds include the Japan International Cooperation Agency (JICA), the African Development Bank (AfDB), the Development Bank of South Africa (DBSA) and Cassa Depositi e Prestiti Spa (CDP), as well as, commercial finance agencies such as Credit Suisse AG and the Industrial and Commercial Bank of China Limited (ICBC).

In November last year COCOBOD inked the syndicated receivables-backed term loan agreement with AfDB, Credit Suisse Group AG and Industrial and ICBC.

In delivering this facility, the AfDB has acted as Original DFI Lender and Initial Mandated Lead Arranger, partnering with Credit Suisse as Original Commercial Lender, Global Commercial Coordinator and Co-Mandated Lead Arranger.

Credit Suisse is also acting as Joint Commercial Underwriter and Bookrunner to structure and fund a dual-tranche facility comprising a US$250 million, 7-year DFI tranche with the Bank, as well as a US$350 million, 5-year commercial tranche.

The Industrial and Commercial Bank of China Limited joined as an Original Commercial Lender, Co-Mandated Lead Arranger and Joint Commercial Underwriter and Bookrunner ahead of syndication.

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