Cocoa bills debt exchange an indication govt can’t pay its debts – Joe Jackson

The Director of Business Operations at Dalex Finance, Joe Jackson, says COCOBOD’s invitation to holders of its short-term debt securities (cocoa bills) to exchange that for longer-term debt securities is simply an indication of the government’s inability to pay its debt.

The financial analyst says the invitation is simply an extension of the recent domestic debt exchange programme the government undertook.

Speaking in an interview on Eyewitness News on Citi FM, Mr. Jackson indicated that per the proposals of the Ghana Cocoa Board, the cocoa bills that were expected to mature in August will not be paid but extended to 2024.

“Just like we did with domestic bonds, the government and COCOBOD have come up to say, we can’t pay our bills. Remember that the last Cocoa Bill was issued in February 2023 at a rate of 32.22 percent per annum and this was supposed to have been paid in August, but it will not be paid and any interest and the principal will be rolled up into one figure.”

He also explained that payment of the interest on those bills will be spread over five years to provide a brief relief for the government.

“Let’s say you have Cocoa Bills worth GH¢68 and interest worth about GH¢32 which adds up to GH¢100, 5 percent of that will be paid in 2024, 20 percent in 2025, 25 percent in 2026, 25 percent in 2027, and 25 percent in 2028 which means that the monies that you should have received this year plus interest, will be spread over the five years starting in 2024. This is another haircut.”

He further slammed COCOBOD for derailing from its original mandate thereby being unable to pay its debts.

“This is truly a COCOBOD problem. COCOBOD has badly managed its affairs, and it hasn’t even published its accounts since 2020, and it is the one that took the money supposedly to purchase cocoa but unfortunately doing other things that are not in its original remit.”