According to the bank, it expects to increase its contribution from the 90 million cedis to 198.1 million cedis within the period.

The Managing Director of HFC, Robert Le Hunte disclosed this at the bank’s maiden consultative summit on the cocoa sector in Kumasi.

“In regards to cocoa, our dominance in the Western region prompted us and we’re looking at deepening our base to the growth of the cocoa industry. We are looking at increasing our financial exposure to that particular industry,” he stated.

The summit brought together officials from the Ghana Cocoa Board, Licensed Buying Companies (LBCs), cocoa farmers as well as companies involved in the production of cocoa to refined products, to discuss issues affecting the sector and devise strategies to address them.

According to Robert Le Hunte, the platform also emanates from the bank’s commitment to “grow beyond just providing financing and look at the holistic development of the industry itself.”

Although issues bordering on illegal mining (galamsey), lack of access to funds, child labour and presence of diseases and pests continue to impede progress in the cocoa sector, Robert Le Hunte was highly hopeful of offering consensus in solving such issues.

Meanwhile the bank intends to increase its support for businesses involved in the production of downstream cocoa sector.

“We are presently giving credit to the cocoa producers, LBCs, we are also helping the cocoa industry by also supporting a number of companies that are engaged in the production of downstream products for the sector.”

“Not only do we realize the contribution of cocoa to Ghana but we also believe that Ghana could significantly benefit from the production at the downstream sector.”

Ghana has however signed a 1.8 billion dollar loan facility for the purchase of cocoa for the 2016/2017 crop season.

Speaking at the signing ceremony in Frankfurt-Germany, the CEO of the Ghana Cocoa Board, Dr. Stephen Kwabena Opuni was confident Ghana could meet its 850,000 to 900,000 metric tonnes target for the 2016/2017.

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By: Pius Amihere Eduku/citibusinessnews.com/Ghana

The post HFC Bank to invest about GH¢200 m in cocoa sector appeared first on Citi 97.3 FM - Relevant Radio. Always.

Ghana on Wednesday [September 21, 2016], signed the 1.8 billion dollars loan facility for cocoa purchases for the 2016/2017 crop year.

The all inclusive rate for the loan facility was 1.47 percent; up from the 1.19 percent the previous year.

Some industry watchers have raised concern at the increase particularly at a time that cocoa sector is faced with an array of constraints which has affected output.

But explaining the rationale for the increase, the Deputy Director of Finance at the Ghana COCOBOD, Asamoah Frimpong said the increase was largely because of the rise in the libor rate at the time of negotiating this year’s credit facility.

“The main factor causing the change in the all inclusive rate was the change in the Libor rate. Last year at the time we were negotiating the loan, the libor rate was 0.1866 percent. That had however shot up to 0.446 percent so the difference was actually caused by the change in the libor. Also, so many factors can contribute to the increase,” he stated.

The exit of Britain from the European Union (EU) in June this year also affected decision on the libor rate.

The LIBOR is a benchmark rate that some of the world’s leading banks charge each other for short-term loans.

Though Ghana signed 1.8 billion dollars, the country is entitled to an additional 200 million dollars from its creditors when the crop performs better and requires further funds.

Indigenous bank, Fidelity, is among the 24 syndicated banks providing the credit facility for COCOBOD.

Meanwhile the CEO of COCOBOD, Dr. Stephen Kwabena Opuni says his outfit with the support of government is making frantic efforts to support the country’s cocoa sector.

According to him, the provision of free hybrid seedlings to cocoa farmers is expected to increase from the 50 million seedlings equivalent to about 42,000 hectares of cocoa farm to 60 million seedlings equivalent to 50,000 hectares of cocoa farms.

This intervention is also expected to culminate in about 500,000 hectares of new cocoa farms over the next ten years.

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By: Pius Amihere Eduku/citibusinessnews.com/Ghana

The post Libor rate led to rise in interests on cocoa loan – COCOBOD appeared first on Citi 97.3 FM - Relevant Radio. Always.

The facility comes with an all-inclusive rate of 1.468 percent.

The agreement was reached at a ceremony between Ghana and representatives from 24 syndicated banks in Frankfurt, Germany Wednesday, September 21, 2016.

Locally owned bank, Fidelity Bank is also part of the agreement.

Under the agreement, Ghana is entitled to an extra 200 million dollars from the syndicated banks if the cocoa crop performs better and requires further funds.

Speaking at the ceremony, the CEO of COCOBOD, Dr. Stephen Kwabena Opuni, was hopeful the country will meet the output target of between 850,000 metric tonnes and 900,000 metric tonnes for the 2016/2017 crop season.

“We are confident of achieving our production target of 850,000-900,000 metric tonnes during the 2016/2017 cocoa season which begins in October 2016,” he stated.

He however decried the impact of the extensive harmattan weather which affected crop production for the 2015/2016 crop season.

“We must admit that our production target for 2015/2016 cocoa season has been adversely affected by the severe and prolonged dry weather conditions that lasted from December 2015 to March 2016.”

Meanwhile Dr. Opuni is confident the country could add at least 500,000 metric tonnes of cocoa in the next ten years following some improvements such as the provision of seedlings to farmers in the sector.

Ghanaian delegation present at the ceremony included the CEO of the Ghana Cocoa Board, Dr. Stephen Opuni; Deputy Finance Minister- Cassiel Ato Forson, Ghana’s Ambassador to Germany, Akua Sena Dansoaa as well as other officials.

The 2016/2017 syndicated loan facility

The facility is the 24^th since its inception in 1992/1993 crop year.

It has a four months’ moratorium and seven months repayment period which starts in February, 2017 and will be completed in August 2017.

The facility was oversubscribed by 640 million dollars.

A total of twenty-four banks are involved in this year’s facility with lead arrangers being eight .viz. Deutsche Bank AG, Natixis, Nedbank Limited of South Africa, Rabobank, Standard Chartered Bank, Societe Generale (SG) while the Bank of Tokyo-Mitsubishi UFJ Ltd and DZ Bank were co-arrangers

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By: Pius Amihere Eduku /citibusinessnews.com/Ghana

The post Ghana secures $1.8 bn for 2016/2017 cocoa purchases appeared first on Citi 97.3 FM - Relevant Radio. Always.