Africa Investment Forum witnessed another historic deal between the African Development Bank, Credit Suisse AG, the Industrial and Commercial Bank of China Limited and Ghana Cocoa Board (COCOBOD) to boost cocoa productivity in Ghana. The $600 million syndicated receivables-backed term loan is expected to give a major boost to the world’s second-largest cocoa producer. Ghana’s cocoa sector provides employment for some 800,000 rural families and earns $2 billion in foreign exchange annually. COCOBOD is a fully state-owned company responsible for Ghana’s cocoa industry, controlling the purchase, marketing and export of all cocoa.
The signing of the deal took place in the presence of Ghanaian President Nana Addo Dankwa Akufo-Addo, the President of the African Development Bank, Dr. Akinwumi A. Adesina, senior officials from Credit Suisse and ICBC. President Akufo-Addo observed that the deal is a turning point for Ghana and bears testimony to the Forum’s capacity to raise the much-needed financing, including from international commercial financiers, for projects in Africa. This is the first time that COCOBOD has access to long-term debt capital. He was confident that the agreement would lead to higher returns for Ghana’s cocoa farmers by scaling up the value chain. Speaking on the occasion, President of the AFDB, Mr Adesina, remarked that “All cocoa-producing countries will get similar support (from the Bank).
Under the deal, the African Development Bank, the Original DFI Lender and Initial Mandated Lead Arranger, is partnering with Credit Suisse as Original Commercial Lender and Global Commercial Coordinator, Co-Mandated Lead Arranger. Credit Suisse is also the Joint Commercial Underwriter and Bookrunner to structure and fund a dual-tranche facility comprising a $250 million, 7-year DFI tranche with the Bank, as well as a $350 million, 5-year commercial tranche. COCOBOD will use the funding to increase cocoa yields per hectare through financial interventions to increase cocoa plant fertility, improve irrigation systems, rehabilitate aged and disease-infected farms. The support will also be used for increasing warehouse capacity and provide support to local cocoa-processing companies.
