Development economist and a senior research fellow at the Institute of Economic Research and Public Policy, (IERPP), Dr. Frank Bannor, has asked the Mahama administration to take the blame for its inability to fulfill the GHC6000 per bag price of cocoa promise to farmers.
In a note copied to media houses, Dr. Bannor insisted that nobody apart from the government is to blame for the paltry GHC128 price increase on a bag of cocoa as announced by the Finance Minister, Cassiel Ato Forson.
“The government must take the blame for not being able to pay GHC6000 to cocoa farmers as they promised them during the 2024 electioneering campaign” he stated.
“The truth of the matter is that, COCOBOD, in their calculations at the beginning of the year, used the prevailing Dollar rate for their projections. As we have all seen, the government has deliberately been pumping more Dollars into the economy in their efforts to strengthen the Cedi. This has weakened the strength of the Dollar, bringing it to around GHC10.4 to the American currency. The differentials have caused COCOBOD a lot, making it difficult for them to pay cocoa farmers what they actually deserve at this time” he stated further.
The GIMPA economist indicated that while strengthening the Cedi may have yielded some positive results in the short term, its long term effects are dire.
“Of course, if the Cedi is strengthened against the Dollar artificially, there are definitely some gains, but they’re short-lived. The long term repercussions of such decisions are dire, and what’s happening in the cocoa sector is the tip of the iceberg” he explained further.
Dr. Frank Bannor urged the Governor of the Bank of Ghana and the Finance Minister to allow the strength of the Cedi to be determined by market forces, and that would enable an entity like COCOBOD to achieve its targets and pay farmers what they were promised.
“For how long is the government going to pump in more Dollars into the forex market when same is not backed by production? What awaits us, if this phenomenon is not curtailed, would be difficult to navigate. Stop the artificial strengthening of the local currency and things will fall in place” he advised.
The Mahama administration has announced a new cocoa price for the 2025/2026 crop season. The price per a bag of cocoa has been increased from GHC3100 to GHC3228. The NDC, in opposition, had emphasized that it would pay farmers GHC6000 per bag of cocoa instead of the GHC3100 the then government was paying to them.
Cocoa farmers across the country feel betrayed and disappointed over the newly announced price as that was not the promise John Mahama made to them.
