Cocoa price increase: Government played naïve investors; hoarding funds for election moves – Simons

The Vice President of IMANI Africa, Bright Simons, has called the government’s decision to increase cocoa prices a “fiscally unorthodox move”.

According to him, despite it being unpopular to increase the prices of cocoa by such a huge margin, it is one that has a two-way perspective.

President Akufo-Addo announced a 63.5% increase in cocoa producer prices from GH¢800 to GH¢1308.

“Today, cocoa prices have increased from GH¢12,800.00 to GH¢20,943.00 per tonne and GH¢1,308.00 per bag,” the President announced.

Bright Simons in a reaction post on September 10, 2023, said while some believe that the increase will address the issues of smuggling among others, it is not the solution to COCOBOD’s bad performance.

“In a politically momentous, if also fiscally unorthodox, move, Ghana has increased cocoa prices by more than 60%. The move divides opinion. Ecstatic pro-farmer groups say this will curb smuggling, boost output & counterintuitively save bankrupt COCOBOD, the state monopoly trader.”

Meanwhile, others see the government’s move as an election-winning tactic as 2024 approaches.

“Fuming fiscal conservatives say the govt played naive investors, forcing them to accept massive losses whilst it hoards resources for populist, election-winning, moves. Policy realists say price is just 1 factor affecting volumes so COCOBOD's bankruptcy will simply worsen,” he said.

SSD/NOQ

In a politically momentous, if also fiscally unorthodox, move, Ghana has increased cocoa prices by more than 60%. The move divides opinion.
A. Ecstatic pro-farmer groups say this will curb smuggling, boost output & counterintuively save bankrupt Cocobod, the state monopoly trader pic.twitter.com/L4zY6ATTZu

— Bright Simons (@BBSimons) September 10, 2023