AfDB, Ghana Cocoa Board, others sign $600mn loan agreement at Africa Investment Forum

An USD 600 million syndicated receivables-backed term loan has been signed among the Industrial and Commercial Bank of China Limited, Ghana Cocoa Board (COCOBOD), African Development Bank and Credit Suisse AG. The objective of signing this agreement (at the ongoing Africa Investment Forum in South Africa's Johannesburg) is to enhance cocoa productivity in Ghana - the world's second-largest cocoa producer.

The President of the African Development Bank Dr Akinwumi Adesina, the President of Ghana Nana Akufo-Addo and senior officials from Credit Suisse and ICBC, oversaw the signing of the facility, at a ceremony held on the second day of the 2019 Africa Investment Forum.

The COCOBOD transaction was launched at the Africa Investment Forum in 2018, and a year later, the signing is a demonstration of the Forum's ability to raise much needed financing, including from international commercial financiers, for projects in Africa. Prior to the agreement, COCOBOD did not have access to long-term debt capital.

"It was critical that we find a mechanism for scaling up the value chain for our farmers and that is where the Bank came in. We see this agreement as a turning point and…to what is possible on this continent," Nana Akufo-Addo opined.

The Industrial and Commercial Bank of China Limited London Branch joined as an Original Commercial Lender, Co-Mandated Lead Arranger and Joint Commercial Underwriter and Bookrunner ahead of syndication. Making sure that Africa gets to the top of the value chain is one of the African Development's Bank's top priorities, President Adesina said, adding that Africa could become a global hub for cocoa and cocoa-based products.

"All cocoa producing countries will get similar support (from the Bank). Ghana is bankable, cocoa is bankable and of course Africa is bankable," Akinwumi Adesina, the President of African Development Bank (AfDB) said.

Ghana's cocoa sector employs some 800,000 rural families and produces crops worth about USD 2 billion in foreign exchange annually. COCOBOD is a fully state-owned company solely responsible for Ghana's cocoa industry, controlling the purchase, marketing and export of all cocoa beans produced in the country.