Ghana Starts Partial Liberalization Of Cocoa Marketing

The government has begun a partial liberalisation of external marketing of cocoa by allowing qualified Licensed Buying Companies (LBC's) to export 30 per cent of their domestic purchases starting from the 2000/2001-crop season.

Export licences were issued in June to LBC's to enable them prepare for the new season.

According to the Third Economic Reform Policy Operation of Ghana, usually known as Letter of Development Policy to the World Bank and International Monetary Fund made available to the Ghana News Agency, the government has promised to deepen competition in internal marketing by giving all LBC's equal access to Cocobod's warehousing and crop financing facilities.

The Letter of Development Policy is a top-secret document developing countries prepare for the World Bank stating definite programmes intended to attract, enhance, and sustain support from the Bretton Woods institutions, their affiliate organisations and partners.

Areas the document covers are politics, policy background on ways of changing the macro-economic environment, debt management, poverty reduction strategy, direction for policy reforms, private sector development, governance, public sector management, divestiture, HIV/AIDS, cocoa and land administration.

The document stressed the enforcement of regulations and laws applying to the repatriation of cocoa export earnings, adding that it would maintain the retention of two per cent enjoyed by the Cocoa Marketing Company to all cocoa exporters.

"A major step to further liberalise external marketing of cocoa will be the discontinuance of price discounts on cocoa supplied to domestic producers, allowing processors to buy cocoa at free on board (FOB) prices, import low grade and cheaper cocoa only for purposes of processing and encouraging local processing through non-price incentives."

"The Ministry of Finance," according to the document, " will verify this on a regular basis." It noted that farmers were to be assisted to rehabilitate and replant old abandoned and destroyed farms with high yielding hybrid varieties and mass spraying of cocoa farms which was underway and would end at the start of the 2002/2003 season.