Cocoa Syndicated Loan: BoG to receive $790m
The Bank of Ghana is set to receive the first share of the $1.1 billion syndicated cocoa loan.
Sources from the Bank of Ghana say that, about $790 million from the consulting banks is expected to hit the account of the Central Bank.
Foreign exchange from the loan is expected to boost the Ghana cedi and shore up its value against the US Dollar.
The funds are to be used to finance the purchases of cocoa beans which will also boost the country’s balance of payment.
Ken Ofori-Atta, the Finance Minister confirmed the inflows of the cocoa syndicated loans at a meeting with business associations and the President, Nana Addo Dankwa Akuffo Addo.
Background
Parliament approved the loan in July, despite efforts to overcome an economic crisis and a nearly $2.5 billion balance-of-payments deficit.
Local currency observers believe the loan will inject the much-needed foreign exchange liquidity into the economy and reduce surging dollar demand, while strengthening consumer demand and reducing inflation expectations.
Ghana’s Cedi currency has been one of Africa’s worst performing currencies this year, having lost around 54% of its value against the dollar.
Cocoa production in Ghana is down sharply this year, seen at 689,000 tonnes as at Sept. 1, 202 after a previous forecast of 800,000 tonnes.
The lower yields partially result from farmers using less fertilizer, with prices having increased worldwide due to high energy prices and supply disruption caused by Russia’s invasion of Ukraine.
