The Ghana Cocoa Board’s (COCOBOD) syndicated loan model was never sustainable, with significant portions of borrowed funds spent on administration rather than core operations, former Lands and Natural Resources Minister Alhaji Inusah Fuseini has stated.
The former Tamale Central Member of Parliament, speaking on Joy FM’s Newsfile programme, criticised the financial management that has left COCOBOD struggling with debt and unfulfilled delivery contracts.
“Anytime they took the syndicated loan, they spent a heavy part of the syndicated loan on themselves, on administration. We raised red flags that this model was not sustainable,” Fuseini said.
The National Democratic Congress (NDC) stalwart drew particular attention to expenditure on cocoa roads during the period when COCOBOD was taking on substantial debt.
“You go and look at the cocoa roads. The amount of money in that period that was spent on cocoa roads. Then you ask yourself, what model was that? How can you rack in that debt and still think that an institution, a trading institution like COCOBOD, could survive?” he questioned.
The comments highlight long-standing concerns about resource allocation within COCOBOD, particularly whether infrastructure projects should have been prioritised while the institution was accumulating debt through annual syndicated loans.
Fuseini also addressed the implications of COCOBOD’s forward-sale contracts, explaining that failure to deliver contracted quantities does not absolve the institution of its obligations.
“If you enter into a delivery contract and fail to deliver the quantities, you’re not excused of that obligation. So, you had forward sold. And when you fail, and there’s a rollover, you are still obligated to supply at that amount,” he explained.
He emphasised that these contractual failures occurred not because buyers refused to take delivery, but because COCOBOD could not supply the agreed volumes – a critical distinction in terms of legal and financial liability.
The former minister noted that Ghana would have benefited from its forward-sale contracts only if cocoa prices in subsequent years had dropped below $2,600 per tonne.
