By Issah Olegor
The NDC government has attributed the mounting financial difficulties confronting the Ghana Cocoa Board (COCOBOD) to what it describes as years of excessive procurement and inherited financial obligations, revealing that billions of dollars worth of fertilizers and agrochemicals were procured far beyond approved budgetary allocations between 2021 and 2024.
The disclosure was made by the Deputy Minister for Finance and Member of Parliament for Asuogyaman, Thomas Ampem Nyarko, during proceedings on the floor of Parliament, where he sought to explain the reasons behind COCOBOD’s growing indebtedness to suppliers of fertilizers and agrochemicals.
According to the Deputy Finance Minister, the financial challenges facing COCOBOD are not isolated incidents but part of broader structural problems inherited by the current administration.
He explained that procurement commitments made over several crop seasons significantly exceeded available budgetary provisions, placing enormous financial pressure on Ghana’s cocoa regulator.
Ampem Nyarko disclosed that during the 2021/2022 cocoa season, COCOBOD procured approximately US$455.7 million worth of fertilizers and agrochemicals despite having only US$312.8 million budgeted for the exercise.
He said the situation became even more serious because outstanding obligations from that season remained unpaid while additional procurement continued in subsequent years.
“The agrochemicals procured for the 2021–2022 season were not paid for, but COCOBOD continued to procure additional quantities in 2022, 2023, and 2024, all of which were above the budgeted amount in each year,” he told Parliament.
The Deputy Minister further revealed that procurement spending widened considerably during the 2023/2024 crop season. According to him, although only US$76.5 million had been allocated in the budget for fertilizers and agrochemicals, COCOBOD reportedly entered into procurement contracts valued at approximately US$668.6 million.
The figures, he said, have raised serious concerns about procurement planning, financial management, and fiscal discipline within Ghana’s cocoa sector.
Beyond the procurement figures, Ampem Nyarko also questioned the effectiveness of the massive expenditure, pointing out that cocoa production continued to decline despite the increasing purchase of fertilizers and agrochemicals.
“While procurement of fertilizers and agrochemicals was increasing, cocoa production was declining, raising questions as to what these fertilizers and agrochemicals were used for,” he stated.
The revelations come at a time when the cocoa sector continues to face multiple challenges, including delayed payments to cocoa farmers, liquidity constraints affecting Licensed Buying Companies, financial difficulties at COCOBOD, and growing public debate over producer prices.
Over recent months, cocoa farmers, purchasing clerks, and stakeholders across major cocoa-producing regions have consistently complained about delayed payments, reduced earnings, and funding shortages during nationwide engagements conducted by the Minority Caucus in Parliament.
The concerns have intensified scrutiny of COCOBOD’s financial management and its ability to finance cocoa purchases sustainably.
Responding to those concerns, the Deputy Finance Minister assured Parliament that government has already begun implementing reforms aimed at restoring COCOBOD’s financial stability and rebuilding confidence within the cocoa sector.
According to him, government is pursuing a structured approach that will enable COCOBOD to gradually settle its outstanding obligations while strengthening its financial position over the long term.
“COCOBOD is approaching the issue systematically. The strategy is to restore its financial capacity so that it can honour its obligations to all creditors, including agrochemical dealers, in a sustainable and transparent manner,” he explained.
Ampem Nyarko further assured suppliers that the reforms currently being implemented are intended to eliminate recurring payment delays and establish a more reliable financing system for the cocoa sector.
“Government is fixing the system so that suppliers are paid not once, but always, predictably, transparently, and on time,” he stated.
The government’s explanation comes amid wider reforms currently being pursued within the cocoa industry, including a new domestic financing model for cocoa purchases, changes to cocoa pricing mechanisms, proposals to strengthen anti-smuggling legislation, and efforts to improve the long-term sustainability of the country’s most important agricultural export.
