For nearly forty years, Ghana’s cocoa industry has operated under the Ghana Cocoa Board Act of 1984 (PNDCL 81), supplemented by various laws introduced over time to regulate specific aspects of the sector. While these statutes addressed the challenges of their respective eras, they have collectively produced a fragmented and outdated legal framework. The overlap of multiple regulations has led to inconsistencies, gaps, and administrative inefficiencies, limiting the ability of COCOBOD and its partner institutions to manage the sector effectively.
These shortcomings have contributed to declining cocoa output, smuggling, mounting debt, and limited value addition, while also hindering Ghana’s ability to meet evolving international sustainability standards.
Against this backdrop, the proposed COCOBOD Bill, 2026 seeks to consolidate existing legislation into a single, modern framework covering Ghana’s more than 800,000 cocoa‑farming households. The Bill aims to replace outdated laws with a comprehensive structure that strengthens governance, enhances financial oversight, improves transparency, and positions Ghana’s cocoa sector to compete more effectively in the global market.
Here are 10 of the most significant economic and financial reforms contained in the Bill and why they matter:
1.70% FOB Price
One of the proposed reforms is a statutory guarantee that cocoa farmers will receive at least 70% of the Gross Free on Board (FOB) price earned by COCOBOD in every crop season. If enacted, the provision would give farmers a legal floor for producer prices, moving the arrangement beyond what has largely been a policy decision under previous pricing frameworks. More importantly, it seeks to strengthen the link between international cocoa prices and the incomes of farmers who produce the commodity.
2. COCOBOD returns to Finance Ministry
The Bill also formally places COCOBOD under the oversight of the Ministry of Finance, following a policy directive in 2025. Oversight of the cocoa regulator had previously been moved to the Ministry of Food and Agriculture as part of reforms introduced in 2017 and formalised in 2020. The proposed return to the Finance Ministry highlights the significant fiscal role of COCOBOD, which has relied extensively on borrowing, syndicated financing and other debt instruments to support cocoa purchases and operations.
3. Fund targeting cocoa debt
A major financial reform under the Bill is the establishment of a Cocoa Sector Debt Sinking Fund dedicated to settling verified historical liabilities accumulated within the cocoa sector. The proposed fund would draw financing from parliamentary appropriations, proceeds from asset recovery, surcharges and negotiated settlements, with the account operating within the Treasury Single Account.
4. Ring-Fencing legacy cocoa debts
The Bill requires all debts incurred before the Act comes into force to be separated from COCOBOD’s ongoing operations. The Finance Minister would have powers to resolve these liabilities through debt restructuring, special purpose vehicles, negotiated settlements or debt set-offs. Simply, efforts to clean up COCOBOD’s balance sheet do not come at the expense of farmer payments or the ability of the Authority to finance cocoa purchases.
5. Stricter sanctions on borrowing
The proposed legislation also seeks to significantly tighten COCOBOD’s borrowing powers. Borrowing would now be restricted to activities directly related to cocoa production, marketing, price stabilisation and value addition. The Bill proposes severe sanctions for officials who authorise borrowing outside these permitted purposes, including fines ranging from 15,000 to 30,000 penalty units, imprisonment of between five and ten years, and a potential 10-year ban from holding public office.
6. 50% local processing target
Beyond financial restructuring, the Bill places significant emphasis on adding more value to Ghana’s cocoa before it is exported. It proposes regulations establishing a minimum threshold for 50% of Ghana’s cocoa production to be processed locally over a transitional period. To make that target achievable, COCOBOD would be required to improve access to cocoa beans, provide financing support, introduce appropriate pricing mechanisms and offer incentives to local processors.
7. No speculative transactions
Per the proposed Bill, COCOBOD would be prohibited from engaging in speculative or highly leveraged financial transactions that expose public funds to excessive risk. Instead, hedging activities would be governed by a formal Cocoa Price Risk and Hedging Policy. Directors and officers responsible for unauthorised transactions resulting in financial losses could also face personal liability through surcharge and recovery proceedings.
8. Producer pricing gets legal backing
The Bill would also give statutory recognition to the Producer Price Review Committee, which has historically advised on cocoa producer prices without an explicit legal foundation. It is expected to give the Committee a formal legal mandate to strengthen transparency and accountability in the producer-pricing process and improve confidence among farmers and other stakeholders.
9. New cocoa stabilisation fund
Another proposed reform is the creation of a Cocoa Stabilisation and Diversification Fund, financed through a percentage of cocoa export proceeds. The Fund would support farmer income protection, productivity-enhancing investments, climate-resilience measures and interventions during periods of significant volatility in international cocoa prices. This mechanism provides a more structured response to future market shocks while supporting longer-term investments in productivity and resilience.
10. Access for small processors
The Bill also seeks to reduce barriers facing small-scale cocoa processors, chocolatiers and businesses producing cocoa by-products. More flexible licensing and regulatory requirements are proposed for smaller operators, potentially allowing more businesses to participate in cocoa processing and value addition. The broader objective is to stimulate entrepreneurship, encourage innovation and widen participation in an industry that has traditionally been dominated by larger players.
Source: Nii Larte Lartey
