The Ghana Cocoa Board (COCOBOD) says it has made significant progress in reducing its financial liabilities following years of severe liquidity and balance-sheet pressures, moving from a negative equity position to positive equity.
At the end of 2024, COCOBOD’s debt stood at approximately GH¢32.9 billion, while total liabilities had risen by 47.5 per cent to GH¢35.8 billion. The regulator also recorded a negative equity position of about GH¢3.8 billion — the first time in its nearly 80-year history that liabilities exceeded assets — alongside significant financial exposure from cocoa road contracts estimated at GH¢26 billion.
The financial deterioration marked a stark reversal from 2016, when COCOBOD posted a positive equity position of approximately GH¢1.8 billion.
Speaking on the development, Chief Executive Officer Dr Randy Abbey said the improvement reflects measures implemented to strengthen the organisation’s finances and contain expenditure.
“Our assets exceed our liabilities, which means we’ve reduced our liabilities. We need to do more, so we have moved from negative equity to positive equity,” he said. “The challenge is how to sustain it, and that’s what we’re focused on.”
Roots of the Crisis
The financial strain was driven by multiple factors, including the collapse of COCOBOD’s 32-year-old syndicated loan model during the 2024/25 season. Ghana was denied access to syndicated financing after failing to honour contractual obligations in the 2023/24 season, forcing COCOBOD to rely on a buyer-financed arrangement that left it vulnerable to market volatility.
The crisis deepened after COCOBOD projected an output of 800,000 tonnes for the 2023/24 crop season but produced only 432,145 tonnes — a 45 per cent shortfall. This resulted in the rollover of 333,767 tonnes of contracts and losses exceeding US7,200 per tonne to US$4,100 per tonne, further straining finances.
A major contributor to the debt burden was COCOBOD’s exposure to cocoa road contracts. Between 2014 and 2024, the board awarded road contracts valued at GH¢26.5 billion, with GH¢21.5 billion committed between 2018 and 2021 — much of it without approved budgetary allocations. Procurement inefficiencies, including the repeated purchase of jute sacks without clearing existing stock, added approximately US$48 million in avoidable expenditure.
Salary Cuts and Cost-Cutting Measures
As part of efforts to reduce costs during the financial difficulties, COCOBOD’s executive management and senior staff accepted salary reductions effective February 16, 2026. Executive management took a 20 per cent pay cut, while senior staff accepted a 10 per cent reduction in their respective salaries. The measures remained in place through the end of the 2025/26 cocoa crop year and were expected to generate savings of about GH¢5 million per month.
The pay cuts formed part of broader cost-cutting interventions, including procurement reforms and a staff rationalisation exercise aimed at reducing overall expenditure and aligning cost with revenue.
Dr Abbey commended the affected staff for accepting the reductions. “I’d like to thank the staff who accepted this pay cut. I know how difficult the decision was for them, and also for my colleagues in top management who agreed to cut their salaries. But this is also to demonstrate our commitment,” he said.
Recovery and Reform
The government has implemented several measures to restore COCOBOD’s financial viability. Cabinet approved the immediate transfer of cocoa road liabilities worth GH¢4.35 billion from COCOBOD to the Ministry of Roads and Highways and the Ministry of Finance, significantly reducing the board’s road contract exposure from GH¢26.5 billion.
COCOBOD has also cleared GH¢3.4 billion of loans and converted major obligations, including amounts owed to the Ministry of Finance and the Bank of Ghana, into equity instruments. Additionally, the board completed a rationalisation process that reduced its cocoa road debt from GH¢26 billion to GH¢4.5 billion under the Domestic Debt Exchange Programme.
In August 2026, COCOBOD began issuing cedi-denominated commercial paper and other domestic debt instruments to finance cocoa purchases, ending decades of reliance on the syndicated loan model. The board also settled GH¢2.3 billion in mandatory payments to holders of bonds affected by the Domestic Debt Exchange Programme for 2026.
Parliament’s Finance Committee Chairman, Isaac Adongo, defended the reforms and the CEO’s leadership, stating that the loans Dr Abbey has paid alone in just one year exceed GH¢10 billion.
Challenges Ahead
Despite the progress, COCOBOD continues to face significant obligations. Deferred debt on cocoa bills means the board must pay GH¢26 billion annually for 2026, 2027 and 2028, adding to the strain on its finances. Debt-service payments of approximately GH¢2.6 billion annually, including payments falling due in 2026, 2027 and 2028, further pressure the balance sheet.
The board entered the 2025/26 season carrying an estimated GH¢60 billion in total liabilities, including GH¢17.8 billion in loans and GH¢26.5 billion in cocoa road contracts.
Dr Abbey said while the progress marks an important step in rebuilding COCOBOD’s financial position, maintaining the improvement will require continued discipline in managing the regulator’s expenditure and liabilities.
