London: The Deputy Chief Executive of the Ghana Cocoa Board (COCOBOD), Ato Boateng, announced progress in implementing a new locally financed funding mechanism designed to raise working capital through commercial paper issuance. Speaking at the Ghana-UK Investment Summit in London, Boateng identified pension funds, commercial banks, international buyers, and other strategic players in the cocoa value chain as key financing sources for the initiative.
According to Ghana Web, preparations for the programme are advanced, with plans to launch the facility before the 2026/2027 cocoa crop season. Boateng emphasized that advisors are finalizing the financing structure and addressing regulatory requirements to ensure a successful launch. The new framework marks a shift from COCOBOD's traditional funding model and aligns with the Government of Ghana's agenda to move away from the longstanding syndicated loan arrangement.
Boateng highlighted that pension funds are a promising source of capital within the new model. The plan also considers commercial banks and private placements involving international buyers and stakeholders across the cocoa value chain. He described these arrangements as innovative solutions to enhance the resilience and sustainability of Ghana's cocoa sector.
The financing framework features a tranche-based drawdown structure aiming to improve operational efficiency and reduce borrowing costs. Boateng explained that this approach allows COCOBOD to access only the necessary funds for cocoa purchases, ensuring prudent resource utilization and minimizing financing costs.
The initiative has gained support from the Minister for Finance, Dr. Cassiel Ato Forson, and the Governor of the Bank of Ghana, Dr. Johnson Asiamah, who praised it as a forward-looking strategy with significant advantages over existing financing models. This development comes amid public discourse on Ghana's cocoa industry's future, addressing concerns from farmers on producer prices, financing sustainability, and the sector's competitiveness.
Industry observers see the proposed commercial paper programme as transformative, potentially deepening domestic participation in cocoa financing, reducing reliance on external borrowing, and supporting the objective of a sustainable and resilient cocoa sector.