Ghana - Ghana Cocoa Board

The proposed operation is a 7-year, USD 600 million (USD150 million from the Bank, and USD 450 million from other financial institutions), receivable-backed, syndicated loan facility to Ghana Cocoa Board (COCOBOD) to finance key components of its Productivity Enhancement Programmes (PEPs). COCOBOD is a fully state-owned company solely responsible for Ghana’s cocoa industry, controlling the purchase, marketing and export of all cocoa beans produced in the country. The objective of the PEPs is to roll out a set of measures that will improve productivity per hectare and increase cocoa production levels well above 1 million tonnes per year (versus an average of 800,000 tonnes per year over the last ten years). The PEPs will mainly entail measures to sustainably increase plant fertility; develop irrigation systems; rehabilitate aged and disease-infected farms; increase warehouse capacity; and create an integrated farmer database. The programmes will also provide short-term working capital support to local cocoa-processing companies, thus facilitating domestic value addition and consumption of cocoa products in Ghana. This long-term investment would help to boost cocoa production through the rehabilitation of ageing plantations, finance new warehouses to store cocoa beans longer and boost the processing of cocoa beans. The Bank is expected to play two roles in this transaction; namely (i) acting as initial Mandated Lead Arranger (MLA) ; and (ii) providing up to a maximum amount of USD 150 million secured senior loan to catalyze the participation of commercial lenders, given their customary limited risk appetite for tenures longer than the one-and three-year facilities that they have been accustomed to providing to COCOBOD.