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ACCRA, Sept 29 (Reuters) – Ghana’s cocoa board (Cocobod) signed on Tuesday a $1.3 billion pre-export finance deal for the 2020/21 cocoa season through a syndicated loan, following reports earlier this year that its usual lenders had declined to underwrite the risk.
A coalition of 28 local and international banks and financial institutions, including ABN Amro ABNd.AS, Standard Chartered STAN.L and Bank of China 601988.SS, were party to the loan, which is repayable in seven months, said Cocobod CEO Joseph Boahen Aidoo at the signing ceremony.
He said Cocobod expected purchases of 900,000 tonnes for the 2020/21 season.
“We never defaulted in repaying the loans since the 1992/1993 crop season when the first one was signed,” Aidoo said, adding last year’s loan was re-paid two months ahead of schedule.
A parliamentary report in August said the loan would carry annual interest of one month Libor plus 1.75%, a commitment fee of 0.62% per year and an upfront flat fee of 1.25%.
On Thursday, Ghana’s president said the West African nation would increase the guaranteed cocoa price it pays to farmers during the upcoming growing season by 28%, in line with an expected rise in neighbouring Ivory Coast.
The price rises are largely due to implementation by the two governments of a price floor of $2,600 per tonne and a Living Income Differential (LID) of $400 per tonne, meant to tackle poverty among farmers.
The two countries account for over 60% of global cocoa bean production.
(Reporting by Christian Akorlie; Writing by Hereward Holland; Editing by Louise Heavens and Mark Potter)
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