• Login
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
  • Home
  • News
    • General
    • Political
  • Economy
  • Business
    • Agribusiness
    • Aviation
    • Banking & Finance
    • Energy
    • Insurance
    • Manufacturing
    • Markets
    • Maritime
    • Real Estate
    • Tourism
    • Transport
  • Technology
    • Telecom
    • Cyber-security
    • Cryptocurrency
    • Tech-guide
    • Social Media
  • Features
    • Interviews
    • Opinions
  • Reports
    • Banking/Finance
    • Insurance
    • Budgets
    • GDP
    • Inflation
    • Central Bank
    • Sec/Gse
  • Lifestyle
    • Sports
    • Entertainment
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video
No Result
View All Result
No Result
View All Result
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
No Result
View All Result
Home Editor's pick

COCOBOD’s Cash Crunch: How Will It Hit the Cedi?

1 year ago
in Editor's pick, Features, highlights, Home, home-news, latest News, Opinions
2 min read
0 0
1
1.1k
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

COCOBOD’s Cash Crunch: How Will It Hit the Cedi?

The regulator of Ghana’s cocoa industry, the Ghana Cocoa Board (COCOBOD), has announced its decision to source funding domestically for the upcoming cocoa season, which begins a month early on September 1, 2024, breaking a 32-year old tradition by the regulator.

The move comes after reports emerged that negotiations for a $500 million bridge loan from cocoa traders such as Barry Callebaut AG and Olam Group Ltd. had stalled.

This is also after the COCOBOD failed to secure the aforementioned amount from the syndicate of international banks as is the norm every year.

COCOBOD’s inability to secure the needed funding is due to consistent declines in cocoa production.

Ghana’s cocoa harvests have consistently missed targets, with production dropping from 683,000 tons in 2021-22 to 654,000 tons in 2022-23, and an anticipated further decline to 501,000 tons by the end of this season – 2023/24.

Additionally, the country is struggling to fulfill at least 250,000 tons of forward sales contracts, some dating back three years.

RelatedPosts

Africa’s Fastest-Growing Economy Sets new Rules for Foreign Stake in Local Banks

Nigeria’s Oil Production Could Reach 2 Million bpd by Next Year

BoG Halts GCB Bank Dividend Payment Over Regulatory Breach

The failure of COCOBOD to secure the $1.5bn from international banks and subsequently $500m from cocoa traders, has implications for the local currency – the Cedi.

The Bank of Ghana has traditionally relied on the lump sum of foreign currency (dollars) that accompanies the annual syndicated loan to manage the exchange rate volatility of the Cedi.

The Cedi has shed approximately 23% of its value against the U.S. dollar this year, making it the fifth-worst-performing currency tracked by Bloomberg in 2024.

The local currency according to Oyinkansola Samuel, an analyst at FirstRand Ltd.’s RMB Nigeria unit, is projected to close the year at GHS 15.97 per dollar due to slowed cedi depreciation supported by improved market sentiment, ongoing debt restructuring efforts, and the anticipated $1.5bn syndicated loan.

Should COCOBOD have secured the $1.5bn loan, the cedi would have witnessed some level of appreciation against the greenback (dollar) contributing to the disinflation trend witnessed since January this year.

But given that the COCOBOD has failed to secure the said amount, market experts anticipate a depreciation of the cedi against the dollar with the cedi very likely to at least cross the GHS 16/$1 mark by the end of the year with potential ramifications of slowing the country’s disinflation trend.

The marginal depreciation of the cedi against the dollar which market experts anticipate, is in view of the further dollar inflows into the economy from the IMF and World Bank, coupled with targeted cedi-depreciation mitigation measures put in place by the Bank of Ghana and the Finance Ministry.

The Finance Minister Dr. Mohammed Amin Adam has stated that his outfit is working with the Bank of Ghana to implement measures to address the depreciation of the local currency.

These measures, he posited, include fast-tracking the fiscal consolidation process through rationalizing spending and enhancing revenue mobilization; intensification of the gold-for-oil programme, and the appropriate foreign exchange interventions by the Bank of Ghana.

Others include the intensification of the gold for reserve programme; the disbursement of the 3rd tranche under the 2nd Review of the International Monetary Fund-supported PC-PEG after the IMF Executive Board approval in June 2024; the disbursement from other ongoing projects including the $150 million World Bank loan and the expected disbursement of $300 million under the World Bank DPO2.

Overall, without the anticipated syndicated loan, the Cedi is likely to experience increased volatility and depreciation unless alternative measures are swiftly implemented by both the fiscal and monetary authorities to shore up Ghana’s foreign exchange reserves and manage the potential economic fallout.

Tags: cediCocobodCOCOBOD’s Cash Crunch: How Will It Hit the Cedi?IMFWorld Bank

Comments 1

  1. DANIEL SARPONG says:
    1 year ago

    This decision being made this year and not in future has serious implication. We are still strugglingl with the depreciatiion of the cedi. The cedi is under pressure . The syndicated loan would have brought some 1.5 billion dollars to shore up our foreign exchange position. The Finance Minister counted on this loan as part of the funds he was looking up to to prevent the cedi from deprecating further. By Septembet, traders would be seeking for dollars to order Christmas goods. The cedi would come under tremendous pressure.
    This decision would definitely affect the ruling governennent.if the cedi depreciates further and prices of goods go up
    We should have donecthis yeas back before the economic crisis or better still next year if by that time our foreign exchange positiion is better .. Anyway it would save us some fees and interest payments estimated to be 150 million dollars which would have been paid to foreign banks. That money would stay in the country.

No Result
View All Result

Highlights

How an Idle Land Tax Could Build 10,000 Homes in 5 Years

Thibaut Courtois Accuses La Liga of ‘Manipulation’ Amid Protests Over Miami Fixture

Historic Bid: U.S. Joins Forces with Mexico, Costa Rica, and Jamaica for 2031 Women’s World Cup

Bank of Ghana Sells GHS 7.0bn in 56-Day Bills at 21.46% Interest Rate

Deputy Finance Minister Hints 2026 Budget to Prioritise Fiscal Discipline and Job Creation 

FirstBank and Coronation Insurance Strengthen Partnership to Deliver Greater Value to Customers

Trending

Business

Africa’s Fastest-Growing Economy Sets new Rules for Foreign Stake in Local Banks

October 21, 2025

Africa’s Fastest-Growing Economy Sets new Rules for Foreign Stake in Local Banks Ethiopia has officially moved closer...

Nigeria’s Oil Production Could Reach 2 Million bpd by Next Year

October 21, 2025

BoG Halts GCB Bank Dividend Payment Over Regulatory Breach

October 21, 2025

How an Idle Land Tax Could Build 10,000 Homes in 5 Years

October 21, 2025

Thibaut Courtois Accuses La Liga of ‘Manipulation’ Amid Protests Over Miami Fixture

October 21, 2025

Who we are?

NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World

NorvanReports is a unique data, business, and financial portal aimed at providing accurate, impartial reporting of business news on Ghana, Africa, and around the world from a truly independent reporting and analysis point of view.

© 2020 Norvanreports – credible news platform.
L: Hse #4 3rd Okle Link, Baatsonaa – Accra-Ghana T:+233-(0)26 451 1013 E: news@norvanreports.com info@norvanreports.com
All rights reserved we display professionalism at all stages of publications

No Result
View All Result
  • Home
  • Business
    • Agribusiness
    • Aviation
    • Energy
    • Insurance
    • Manufacturing
    • Real Estate
    • Maritime
    • Tourism
    • Transport
    • Banking & Finance
    • Trade
    • Markets
  • Economy
  • Reports
  • Technology
    • Cryptocurrency
    • Cyber-security
    • Social Media
    • Tech-guide
    • Telecom
  • Features
    • Interviews
    • Opinions
  • Lifestyle
    • Entertainment
    • Sports
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
NORVANREPORTS.COM | Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.