The government will overhaul Ghana’s cocoa financing system, convert billions of cedis in legacy debt and introduce cocoa bonds to restore the financial health of the Ghana Cocoa Board (COCOBOD), Finance Minister Dr Cassiel Ato Forson has announced.
Speaking at a national briefing on Thursday (12 February), Forson said a review of the sector revealed “gross mismanagement” over the past eight years that left COCOBOD heavily indebted and unable to finance purchases from farmers.
He disclosed that COCOBOD has inherited significant liabilities, including GH¢5.8 billion owed to the Ministry of Finance and the Bank of Ghana, as well as GHC4.35 billion in cocoa road obligations.
Cabinet has directed the Finance Ministry to seek parliamentary approval to convert the debts into long-term instruments to restore the board’s balance sheet and improve market confidence.
“The debt conversion will restore positive equity and boost international and local market confidence to support the operations of the Ghana Cocoa Board,” Forson said.
A central plank of the reforms is a new domestic financing model to replace the collapsed syndicated loan structure that previously relied on forward sales and buyer pre-financing.
Under the new system, COCOBOD will issue domestic cocoa bonds to raise a revolving fund for purchasing beans within each crop year.
Forson said the previous model limited Ghana’s ability to optimise prices and weakened local processing capacity.
To boost value addition, Cabinet has also directed that at least 50% of Ghana’s cocoa beans be processed locally from the 2026/27 crop season. For the remainder of the next season, unsold beans will be prioritised for domestic processors.
The state-owned Produce Buying Company (PBC) and Cocoa Processing Company (CPC) will be revived to play leading roles in purchasing and processing operations.
The government has additionally barred COCOBOD from undertaking quasi-fiscal and non-core expenditures such as road construction, which Forson said significantly contributed to its financial distress. Instead, cocoa roads will be handled under a separate $500 million World Bank agricultural roads programme.
In a further move, Cabinet has directed the Attorney-General to launch a forensic audit and criminal investigation into COCOBOD’s activities over the past eight years.
“We must ensure accountability and transparency in the management of Cocoa Board and the cocoa sector as a whole,” he said.
Ghana, the world’s second-largest cocoa producer, has recently faced declining output, unsold stocks and delayed farmer payments, threatening the sustainability of the sector.
Forson said the reforms are designed to stabilise operations, reduce wasteful spending and secure the long-term future of the industry.
“These are not proposed reforms,” he stressed. “These are reforms we are implementing immediately.”
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