The Chief Executive Officer of the Ghana Association of Banks, John Awuah, has commended the government for its “fiscal discipline” in the wake of the recent emergency reduction in the producer price for cocoa.
Mr Awuah described the move, while painful for farming households, as a necessary “bull by the horn” intervention to prevent the total insolvency of the Ghana Cocoa Board (COCOBOD).
His remarks follow the controversial reforms of the cocoa economy, where the farmgate price was slashed from GH¢3,625 to GH¢2,587 per bag to align with a volatile international market.
Mr Awuah was explicit in his praise for President John Mahama and Finance Minister Dr Cassiel Ato Forson, noting that the decision demonstrated a willingness to prioritise national survival over political optics.
In a climate where economic decisions are often shrouded in populist rhetoric, Mr Awuah argued that this “unpalatable” move was a hallmark of responsible governance.
“I commend His Excellency, the President and Hon Ato Forson for putting Ghana first in taking the difficult decision of reducing the producer price for cocoa in line with world market price movement. This tells me that when they have to take unpalatable decisions to keep Ghana going, they are prepared to put the country first,” he stated in a post on LinkedIn.
The banking chief issued a stern reminder to the political class regarding the limits of domestic policy. He noted that since Ghana does not control the global price mechanism for cocoa, politicians must resist the urge to turn market downturns into partisan ammunition.
“The lesson here is that politicians must learn not to politicise economics; when you do not have full control of the price mechanism… keep quiet and enjoy when you have windfall and save some for difficult seasons,” Mr Awuah cautioned.
Addressing the thousands of farmers in the Western North and Ashanti regions who are currently reeling from the income drop, Mr Awuah admitted the situation was “unfortunate” but insisted the blame does not lie with the economic managers.
He framed the price cut as a life-saving surgery for the institution that governs their livelihood.
“To our farmers, it is unfortunate, but you can’t blame the managers of the economy. They have taken a decision to save COCOBOD from collapsing at the current guaranteed price. As difficult as this might be to you and your household, the government has done the right thing to keep COCOBOD going,” he added.
While supporting the price cut, the CEO of the Association of Banks was equally firm on the need for internal reform.
He argued that the “fiscal responsibility” shown in the price reset must now be matched by a ruthless cleanup of COCOBOD’s operational inefficiencies.
Awuah’s Blueprint for COCOBOD Reform:
- End Overstaffing: Addressing the ballooning workforce that drains administrative budgets.
- Procurement Integrity: Eliminating “ineptitude” in the purchase of fertilisers and chemicals.
- Operational Realignment: Focusing on productivity rather than bureaucratic expansion.
“It is now time to purge COCOBOD of the waste, overstaffing, unproductivity, procurement ineptitude and operational misalignment,” he insisted.
As the 3rd March deadline for the new bond-backed financing model approaches, Mr Awuah’s endorsement provides a critical “market-friendly” signal to investors and local banks, suggesting that the banking sector views the current cocoa crisis as being managed with the necessary transparency.
