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Ghana’s cocoa board agrees $800 million loan with banks

Published

11 months ago

December 19, 2023

The deputy chief executive officer of Ghana’s Cocoa Marketing Board has confirmed that the body has signed $800 million syndicated loan with banks, and expects to draw down the first $600 million from next week.

The West African nation uses a yearly syndicated loan, typically agreed upon at the beginning of the farming season in September, to finance its purchases of beans from farmers. However, this year’s loan has been delayed as Ghana attempts to restructure its bilateral and commercial debts while battling its worst economic crisis in a generation.

“I joined COCOBOD in 2018 and this is the hardest transaction we have had,” COCOBOD Deputy CEO, Ray Ankrah, told journalists.

“It’s been signed and we are working on the drawdown. We’re drawing down $600 million by the end of this week and we expect to draw down the $200 (million) in the middle to the end of January,” he said, adding that the terms of the loan had not changed from those presented to parliament last month.

The transaction was recently approved by the Ghanaian parliament, enabling the COCOBOD board to finalise the documentation with the participating banks. The law permits COCOBOD to pay interest at a rate of almost 8%, which consists of a 2.65% margin and the one-month Secured Overnight Financing Rate (SOFR), which is currently at 5.3%.

Ghana is the world’s second-largest cocoa producer behind neighbouring Ivory Coast. West Africa collectively supplies two-thirds of the world’s cocoa crop, with nearby countries like Ghana, Nigeria, Cameroon, and Togo producing additional 1.55 million tonnes annually. But production has been affected by irregular climate, drought and flood in recent years.

Some observers have argued that the continent must step into the processing of raw materials like cocoa to maximize market opportunity for end products, otherwise the industrialized societies with chocolate factories will continue to milk the space at the expense of producers of local raw materials.

Related Topics:Cocoa Cocoa Board Featured Ghana

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VenturesNow

Food prices drive second straight monthly hike in Nigeria’s inflation

Published

2 days ago

November 17, 2024

Ifeoluwa Dada

According to official statistics released on Friday, Nigeria’s inflation rate increased for the second consecutive month in October, rising to 33.88% in annual terms from 32.70% in September, mostly as a result of increasing food costs.

In an attempt to boost economic development and strengthen public finances, President Bola Tinubu devalued the naira and reduced subsidies, which caused inflation to spike in the second half of last year.

As the effects of the naira devaluation started to lessen in July of this year, a slew of hikes in the price of petroleum and devastating floods that destroyed crops once again exacerbated pricing pressures, making the greatest cost-of-living crisis in decades worse in Africa’s most populous country.

According to the National Bureau of Statistics, price increases for basics such as rice, maize, bread, potatoes, and cooking oil prompted food inflation to surge from 37.77% in October to 39.16% year over year.

This year, more than 1.5 million hectares of agriculture have been damaged by torrential rain and floods in 29 of Nigeria’s 36 states, leaving millions hungry and displacing large numbers of people.

In an effort to curb inflation, the central bank has raised interest rates five times this year. On November 26, it is expected to make its final rate decision of the year.

VenturesNow

MTN financial report reveals drop in group service revenue

Published

2 days ago

November 17, 2024

Ifeoluwa Dada

Due to operational difficulties in Sudan and the depreciation of the Nigerian naira, MTN Group, Africa’s largest telecom provider, announced on Thursday an 18.5% decline in service revenue for the third quarter that concluded on September 30.

With 288 million users in 17 African regions, MTN said that its group service revenue dropped from 156.3 billion rand ($6.99 billion) in the same quarter of the previous year to 127.4 billion rand.

Despite stating that “the naira was less volatile on a sequential basis in Q3 than in preceding quarters,” the business reported a 48.7% decline in MTN Nigeria’s income due to the currency’s depreciation.

Due to a stronger Ugandan shilling than the previous year, Uganda’s largest contributor, MTN South Africa (MTN SA), expanded by a meagre 3.3%.

Due to “subscriber registration regulations in Nigeria and a decline in users in Sudan, where the conflict has displaced millions of people,” the business reported that its subscriber base increased by 1.6% to 288 million.

Given the higher demand in Nigeria despite the legal obstacles, MTN plans to increase its capital expenditures, which it expects would total between 28 and 33 billion rand for the entire year.