Cocoa crisis deepens, calls for CEO’s dismissal; President convenes emergency cabinet meeting today
The government is grappling with a severe crisis in the cocoa sector, with thousands of farmers awaiting payments for crops delivered since late last year.
The situation has escalated to the highest levels of government, prompting President John Dramani Mahama to summon an emergency Cabinet meeting today to address what industry stakeholders warn is a looming collapse.
Calls for leadership change
The financial crisis has triggered direct political pressure, with activists calling for the removal of the sector’s leader.
Listowell Nana Poku, a member of the ruling National Democratic Congress (NDC), has publicly petitioned President Mahama to immediately dismiss Dr. Randy Abbey, the Chief Executive of the Ghana Cocoa Board (COCOBOD).
Nana Poku, who petitioned in his capacity as the Executive Director of Good Governance Advocacy Group Ghana, argued the sector cannot afford trial-and-error leadership during this critical time.
He criticized Dr. Abbey’s appointment, stating that his leadership is marked by poor leadership, incompetence, arrogance, intimidation tactics and financial mismanagement.
The calls for dismissal come amid a perfect storm of financial mismanagement and a crashing global cocoa market.
Payment gridlock
COCOBOD has failed to reimburse Licensed Buying Companies (LBCs), which in turn cannot pay farmers for beans already delivered. Funds owed now exceed GH¢10 billion, crippling the purchasing system.
The government set a high farmgate price for farmers early in the season.
However, global cocoa prices have since plunged by nearly 50% to around $4,000 per tonne.
This mismatch has left an estimated 150,000 metric tons of cocoa stranded without buyers.
Collapse of financing
The traditional syndicated loan system used for decades to pay farmers upfront has broken down due to COCOBOD’s weakened financial position, leaving no reliable payment mechanism.
Farmers in distress
A cocoa purchasing clerk with over 20 years of experience described the situation as unprecedented. “From November till now, I can’t sleep. In my 20 years in this business, I have never seen a situation where cocoa is bought, and the government cannot pay”.
