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Dr Mark Assibey-Yeboah, Chairman of Parliamentary Finance Committee
Parliament has approved $6.5 million tax waiver for the payment of stamp duty on the purchase of cocoa.
Additionally, it also approved an amount of $1.3 billion loan to purchase Cocoa for the 2020/2021 crop season.
According to the report by Parliament’s Finance Committee, which was signed by Dr Mark Assibey-Yeboah, Chairman of the Committee, the purpose for these approvals is to enable Ghana Cocoa Board (COCOBOD) to raise funds to purchase Cocoa beans from farmers through Licensed Buying Companies and to finance other operations of the board for the 2020/2021 cocoa season.
He noted that that the cocoa industry has been the backbone of Ghana’s economic development over the years. The industry has over the years provided employment for millions of Ghanaians and serves as a major source of foreign exchange earner for the country, hence the need to support it with money.
Breaking down how the $1.3 billion will be used for, Mr Assibey-Yeboah said that the operational areas for the disbursement would be in two areas, namely Farmers Services Cost and Share of Net FOB.
Some of the items that fall under the Farmers Services Cost are the purchase of Cocoa disease and pest control products, fertilizer distribution and application, farmers’ awards scholarship and cocoa roads, industry inputs, replanting and child education support.
Other uses of the money will be for payment of farmers, buyers margin, haulers margin, storage and shipping operations, disinfection, COCOBOD and divisions.
Throwing more light on the need to pump more money into the sector, the chairman said cocoa production in Ghana has also increased significantly since the 1999/2000 crop season, reaching an all-time high of over one million metric tonnes in the 2010/2011 crop season.
This increase in the levels of production requires substantial financial resources to enable the Ghana Cocoa Board (COCOBOD) to finance the purchase of cocoa beans.
To this end, the Syndicated Trade Finance arrangement was put in place in 1993 to enable the Ghana Cocoa Board secure a loan facility to finance cocoa purchases and for other payments each year and said the facility is to enable the COCOBOD purchase cocoa for the 2020/2021 crop season, Mr Assibey-Yeboah said.
The committees report also observed that the cocoa industry plays a crucial role in the economic development of the country. The industry contributes significantly to the Gross Domestic Product (GDP), employs an estimated two million people along the supply chain and remains a major source of Ghana’s foreign exchange earnings.
The report also said the cocoa sector also supports infrastructural development in education, road and highways among others and most of the foreign exchange earnings from cocoa are retained in the country thereby boosting foreign exchange reserves in the country in support of the local currency.
One other significant observed was that an amount of GH¢880,841,842.98 was spent on fertilizers for the 2019/2020 Crop Season, yielding a projected cocoa output of 850,000 metric tonnes.
However, for the 2020/2021 Crop Season in which COCOBOD projects to achieve a production target of 900,000 metric tonnes, only GH¢661,399,000.02 has been allocated to be spent on fertilizers.
However, officials of COCOBOD confirmed that the Board was scaling down this year on the application of fertilizers and explained that best agronomy practices require that cocoa fertilizer application takes a break after every three years, and hence fertilizer application for the 2020/2021 Crop season has been optimally assessed taking into consideration the level of fertilizer application for the past three seasons.
The post Parliament approves US$6.5m waiver to purchase Cocoa appeared first on The Chronicle Online.
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