The first disbursement of the syndicated loan facility was welcomed in Accra, Ghana on Tuesday 23 June by COCOBOD, government representatives and development finance institutions including the African Development Bank (AfDB), the Japan International Cooperation Agency (JICA), the Development Bank of Southern Africa and Cassa Depositi e Prestiti Spa. Commercial lenders were represented by Credit Suisse AG, and the Industrial and Commercial Bank of China, London Branch.
The US$600mn syndicated loan agreement was signed in November last year at the Africa Investment Forum in Johannesburg. JICA and the AfDB agreed to provide US$3.5bn in joint financing, under the fourth phase of the Enhanced Private Sector Assistance for Africa Initiative.
“There are challenges with productivity in the country’s cocoa production, 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 facility will help COCOBOD to contribute to achieving Sustainable Development Goals,” COCOBOD CEO Joseph Boahen Aidoo remarked.
COCOBOD will use the facility to raise cocoa yields per hectare and increase Ghana’s overall production. Activities under the facility will include the allocation of financing to sustainably increase cocoa plant fertility, improve irrigation systems, and rehabilitate aged and disease-infected farms. The funds will help increase warehouse capacity and provide support to local cocoa-processing companies.
“African countries like Ghana and Cote d’Ivoire produce nearly three quarters of the global supply of cocoa. This loan to COCOBOD aims to improve the quantity and quality of local processing, boosting incomes of local farmers and their communities as well as generating new and better jobs,” AfDB vice-president for agriculture, human and social development Dr Jennifer Blanke said.
In March 2020, after the close of the syndication process, an amended agreement brought on board the Japan International Cooperation Agency (JICA), the Development Bank of Southern Africa and Cassa Depositi e Prestiti Spa,and other commercial lenders.
“This loan marks the first time JICA and the AfDB will be providing direct co-financing under the Enhanced Private Sector Assistance for Africa initiative (EPSA4) as well as being the first non-sovereign project,” Yasumichi Araki, chief representative of JICA Ghana, added. “JICA will continue to commit to the cocoa industry in Ghana through innovative interventions to COCOBOD.”