Ghana’s parliament has approved a trade finance facility of US$1.2 billion for the purchase of cocoa beans for the 2013/2014 crop season, following a request by the Ministry of Finance and Economic Planning.
The approval gives the Cocoa Board (COCOBOD) permission to raise the above-mentioned amount on the international market for the purchase of an estimated 830,000 tonnes of cocoa beans, at a projected cedi/dollar exchange rate of 1.89 to 1. COCOBOD was already in an arrangement between a consortium of several international and local banks for the US$1.2 billion, but needed parliamentary approval before being able to access the facility.
Among the lenders are First Rand Bank Limited, Credit Agricole Corporation and Investment Bank, Nedbank Limited, Tokyo-Mitsubishi UJF, as well as Societe Generale. The offshore syndicated trade finance arrangement is reported to cost COCOBOD US$14.08 million. The House also approved a request to waive stamp duty amounting to US$12 million on the facility to ensure COCOBOD accesses the full credit for cocoa purchases for the 2013/2014 crop season.
However, the approval was not without debate from the minority and majority sides of the House. Though the minority conceded the exercise was good in the interest of the nation, it was furious as to why the request was being made at the 11th hour when the House was going on recess.
Leader of the minority, Osei Kyei-Mensah-Bonsu, argued that the report, in part, was ambiguous, and called for further and better particulars to enable the House to scrutinise the deal properly.
For instance, he said, in arriving at the projected figure for the 2013/2014 crop season, “the demand should be premised on the actual,” but that was not fairly represented on the Finance Committee’s report to Parliament regarding the arrangement.
Additionally, since COCOBOD had already indicated that it did not spend all the money raised for the 2012/2013 crop season on purchasing cocoa beans alone, but on others, it would be better for it to furnish Parliament with the breakdown on how the said money was spent. He pleaded with the Speaker to direct the Minister of Finance and Economic Planning to come to the House and answer to the pertinent issues raised on the facility.
The First Deputy Speaker, Ebo Barton-Odro, who presided over the sitting, granted the request.
