Licensed Buying Companies (LBCs) in the country are expected to heave a sigh of relief as Minister-designate for Agriculture, Dr. Owusu Afriyie Akoto drops hints of plans by the government to start payment of debts owed them.
He said the Central Bank is collaborating with COCOBOD to raise funds to pay Licensed Buying Companies (LBCs).
“In the meantime the Central Bank is cooperating very closely with COCOBOD to give them some bridging facility to help pay for the cocoa they have taken from the farmers”.
He stated that this has been a very unfortunate situation in the past month or two because of the peculiar nature of the cocoa industry.
Dr. Akoto taking his turn at Parliament’s Appointments Committee was empathic that the farmers will start getting paid for their produce beginning this week.
“Before the end of the year, normally, we should have had enough contracts for the release of the whole amount of $1.3 billion, unfortunately we could not sell that fast so, now that we have the contracts sold, we are expecting that coming week, early next week the last tranche of $190 million will be with us and then we can pay for all the outstanding cocoa and that issue will be behind us.”
According to the Agric minister designate, payment for the produce had delayed because of the decline in chocolate production across Europe and America because of the coronavirus and its attendant lockdown.
Dr. Akoto stated that because of the decline, Ghana was unable to sell enough contracts to trigger the release of the last tranche of the cocoa syndication loan worth about $190 million.
“For the first time, in I don’t know how many years; it has not been possible for us to sell enough contracts to enable the last tranche of about $190 million to be released.”
The Ministry continued: “In fact, if you compare the amount of contracts that has been sold out this year compared to same period last year, we have done nearly one-third which means that the decline in the banks for cocoa beans by the chocolatiers’ and processors which is a result of the covid and the lockdown in Western Europe and in America is really affecting our operations here.”
Dr Akoto’s comment comes after NDC MP for Buem, Kofi Adams had alleged that Licensed Buying Companies (LBCs) in the cocoa sector are carting cocoa from farmers without paying.
According to Mr Adams, reports from his constituency and other constituencies in the cocoa-growing regions is that cocoa farmers have not been paid by LBCs for their cocoa purchased in the last two months even though they are in the third month of the main cocoa season.
He indicated that the inability of Cocobod to pay the LBCs has also affected the livelihoods of cocoa farmers since LBCs are unable to pay the cocoa producers.