Parliament approves $1.3 billion for 2018/2019 Cocoa purchase
| Updated Jul 26, 2018 at 8:10am
Phot by Enoch Norvor
Parliament has adopted the report of The Finance Committee on the terms of a Receivables-Backed Trade Finance of facility between Ghana Cocoa Board (COCOBOD) and a consortium of banks and financial institutions, with The Government of The Republic of Ghana as guarantor, for an amount of up to One Billion, three hundred Million United States Dollars (US$1,300,000,000.00) for the purchase of cocoa in Ghana for the 2018/2019 crop season.
The request for approval for The Facility was presented to Parliament on Wednesday, 18th July, 2018 in accordance with Article 181 of The 1992 Constitution.
Further, a request for The Waiver of Stamp Duty amounting to Six Million, Five Hundred Thousand United States Dollars (US$6, 500,000) on the Receivables-Backed Trade Finance of Facility.
The rationale of the request is to enable COCOBOD to raise adequate funds to purchase cocoa beans from The Farmers through licensed buying companies for 2018/2019.
Stating the reason for The Waiver of Stamp Duty, The Chairman of The Finance Committee in Parliament, Dr. Mark Assebey Yeboah, noted that the “Section 32 (6) of The Stamp Duty Act, 2005 (Act 689) makes it imperative to stamp a loan document at 0,5% of The Facility, in order to ensure that the full value of the loan is used for cocoa purchases in the 2018/2019 crop season, there is the need to waive The Stamp Duty on The Loan Facility. The amount to be waived has been assessed as US$6, 500,000”.
The Committee’s report captured The CEO of The COCOBOD as saying that, The Board would not reduce the Farmers price of cocoa, stressing the point that, “a reduction in the current Farmer prices would further worsen the already existing situation. Even though many countries have reduced their producer prices in the face of declining world market prices, COCOBOD continued to maintain the current prices in order to keep the Farmers in business”.
It was important in order to maintain interest in cocoa farming, he mentioned.
On provision for stabilization fund, The Committee said, “The technical team informed the committee that stabilization fund is part of the positive margin between international prices and producer prices. Currently, the producer prices are higher than the international prices hence the margin is adverse. If the situation improves, payment would be made into the Stabilization Fund”.
Story by Edzorna Francis Mensah