The Ghana Cocoa Board (COCOBOD) has announced that it has begun disbursing funds to Licensed Buying Companies (LBCs) to enable them to clear outstanding payments owed to cocoa farmers for beans already supplied. This move comes amid mounting concerns over prolonged payment delays, which have left many farmers unpaid for months and sparked fears about the sustainability of the cocoa industry.
The issue gained prominence on Thursday, February 5, when the Minority in Parliament cautioned that the situation was inflicting severe hardship on farmers and jeopardising the entire cocoa value chain. According to the Minority, COCOBOD owes LBCs in excess of GH¢10 billion for cocoa already procured, a debt that has strained the companies’ cash flow and hindered timely payments to farmers.
COCOBOD, however, explained that the delays stemmed from difficulties in securing syndicated financing, forcing the Board to depend on alternative funding arrangements with international cocoa buyers. Under those arrangements, LBCs pre-financed cocoa purchases, with COCOBOD reimbursing them later.
The Board has made substantial disbursements over the past few months to ease the situation and ensure farmers are paid what they are owed. “In November, we paid over GH¢6 billion, in December more than GH¢5 billion, and in January another GH¢6 billion.
“This month alone, we have paid over GH¢620 million, and we are continuing to pay the LBCs so they can clear outstanding payments to farmers,” Jerome Kwaku Sam, Head of Corporate Communications at COCOBOD, said in an interview on Citi FM.
He added that the Board is working with the current administration to develop a new, more sustainable financing model for the cocoa sector to prevent a recurrence of such delays, stressing that COCOBOD remains committed to prompt farmer payments and the long-term stability of the industry.
Source: myjoyonline.com
