World Bank calls for far-reaching reforms to COCOBOD Act

The World Bank has advocated for comprehensive reforms to the Ghana Cocoa Board (COCOBOD) Act, aiming to implement market-based principles and mitigate financial risks associated with Ghana's cocoa industry. Robert R. Taliercio, the World Bank Division Director for Ghana, Liberia, and Sierra Leone, highlighted financial and operational inefficiencies within COCOBOD, which are burdening farmers and the nation's public finances.

At the launch of the World Bank’s Tenth Ghana Economic Update in Accra, Taliercio emphasized the necessity of legal and operational reforms to ensure the cocoa sector's sustainability. He welcomed ongoing discussions and debates on the Cocoa Board Act, suggesting extensive reforms to promote market-based principles and minimize the sector's quasi-fiscal risks.

Without significant reforms in the cocoa and energy sectors, some fiscal improvements under Ghana’s economic reform program could be quickly reversed. The World Bank's call arises from concerns over COCOBOD’s financial standing and the sector's impact on government finances. Taliercio stressed that the cocoa sector's challenges are among the key domestic risks threatening Ghana’s economic recovery if left unaddressed.

He urged Ghana to bolster its fiscal position and reduce reliance on measures that could further strain public finances. The World Bank official noted that Ghana’s economic recovery is "structurally incomplete" despite progress in macroeconomic indicators, citing the country’s heavy reliance on cocoa and gold exports, which makes the economy vulnerable to fluctuations in international commodity prices.

Diversifying Ghana’s export base and implementing reforms that encourage market-based economic activity are crucial for building a more resilient economy. The World Bank urged the government to maintain reform momentum and tackle structural weaknesses in the cocoa sector to safeguard fiscal gains and foster long-term economic growth.