….as Cocoa Board plans to sign $600m loan pact with AfDB
Ghana’s cocoa regulator plans to sell bills and notes next year as it looks for ways to fund the replanting of diseased trees.
The Chief Executive Officer of the Cocoa Board, Joseph Boahen Aidoo in a telephone interview on Tuesday with Bloomberg said that the Board may issue 182-day bills and one-year notes to fund operations, said.
According to statistics compiled by the news medium, the Board raised 3.7 billion cedis ($818 million) through cocoa bills this year.
About a fifth of Ghana’s cocoa tree stock is affected by swollen shoot disease, a virus that reduces yields and kills a plant within three to four years, while another quarter are old and unproductive. The country is the world’s second-biggest cocoa producer.
Boahen hinted that the regulatory group needed between $200 million and $250 million to cut and replant trees affected by swollen shoot disease, adding that the board may also sign a $600 million, five-year facility with the African Development Bank (AfDB) in the last quarter of 2018.
This is even as he said that the Board was working on a $750 million medium-term loan from local and international banks, but that the timing hasn’t been decided.
Boahen was quoted as saying that banks have begun indicating how much they would like to lend to finance the project without providing details of the banks involved and the terms.
He clarified further: “On our current budget, we have started cutting down affected trees and replanting on a minimal scale. We will go for cocoa bills to keep our operations going, at least the normal operations, while we wait for the loans talks to bear fruit.”
Latest data about the scourge showed that about 20 percent of Ghana’s cocoa trees are affected by swollen shoot disease and another 25 percent are old and need replanting, he said.
Bloomberg reported that cocoa output in areas with swollen shoot had decreased to 20 kilograms per hectare from 450 kilograms. The disease causes trees to have few pods or no pods at all. Some farmers have abandoned affected farms, creating a risk that farms could be converted to small-scale mining sites.
Despite the problem, Boahen said that his Board was hopeful that production in the 2017-18 season would meet a 850,000-ton goal.
He explained that in order to meet the target, the board will increase hand pollination among the 55 percent of tree stocks that are healthy to achieve targets, adding that “that is why we need to move fast with solutions. We need to keep our head above water.”