Ghana to raise $1 billion through cocoa-backed bonds to revive struggling sector

• Ghana plans to raise up to $1 billion through cocoa bonds as part of major reforms in the cocoa sector.

• The initiative aims to reduce the debt burden of Ghana Cocoa Board (COCOBOD) and shift away from reliance on foreign syndicated loans.

• Government reforms also target increased local cocoa processing, revival of Produce Buying Company and improved financial sustainability for farmers and buyers.

The Government of Ghana is preparing to raise as much as $1 billion through domestic cocoa bonds as part of a sweeping overhaul aimed at rescuing the country’s troubled cocoa sector and reducing the heavy debt burden of the Ghana Cocoa Board (COCOBOD).

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According to a report by Bloomberg, the proposed financing arrangement forms part of broader reforms designed to move Ghana away from its long-standing dependence on syndicated foreign loans used to finance cocoa purchases.

Under the new model, COCOBOD plans to issue domestic cocoa bonds that will be repaid from cocoa sale proceeds within the same crop season.

The shift could improve financial sustainability, revive local cocoa buying companies and stabilise payments to farmers.

The move comes at a difficult period for the country’s cocoa industry, which has been battling falling output, rising debt, payment delays to farmers and declining global cocoa prices.

Earlier this year, Bloomberg reported that COCOBOD’s debt had ballooned to about 32 billion cedis, equivalent to nearly $2 billion, forcing the regulator to review its financing model and expenditure.

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Finance Minister Cassiel Ato Forson previously announced plans to introduce a more flexible domestic pricing system linked to international cocoa prices after a sharp slump in global futures made Ghanaian cocoa less competitive on the global market.

Reuters reported in February that Ghana cut cocoa producer prices by nearly 29 percent as part of emergency reforms intended to address unsold stockpiles and ease pressure on the cocoa marketing system.

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The reforms are also expected to increase local processing of cocoa beans. Government directives indicate that at least 50 percent of Ghana’s cocoa output should be processed locally beginning from the 2026/27 crop season in an effort to boost value addition and create jobs.

Cabinet has additionally directed that the state-owned Produce Buying Company (PBC), which has lost significant market share in recent years, be revived to play a leading role in cocoa purchasing once again.

Ghana remains the world’s second-largest cocoa producer after neighbouring Côte d’Ivoire, with cocoa continuing to play a critical role in foreign exchange earnings and rural livelihoods.