Africa Growing Together Fund provides $43.7 million loan to COCOBOD to finance key components of its Productivity Enhancement Programs (Linked to Record ID#86575 and Umbrella Record ID#36104)

Project narrative

On May 22, 2014, the African Development Bank (AfDB) and the People's Bank of China (PBOC) signed an agreement for the Africa Growing Together Fund (AGTF) (see Umbrella Record ID#36104). The purpose of this $2 billion loan facility was to finance large development projects in Africa between 2014 and 2024. The AGTF is sponsored by the PBOC and the administered by AfDB. Then, on March 5, 2020, AGTF signed a 7-year, $43,724,697 senior (receivables-backed) loan agreement (AGTF Loan ID#5050130000457) with Ghana Cocoa Board (COCOBOD) to finance key components of its Productivity Enhancement Programmes (PEPs). On the same day, the African Development Bank (AfDB) issued a 7-year, $106,275,303 senior (receivables-backed) loan (AfDB ID#2000130021092) to COCOBOD to finance key components of its PEPs. These loans were part of a larger $600 million syndicated facility that consisted of two tranches: a 7-year, $250 million tranche from development finance institutions (DFIs) and a 5-year, $350 million tranche from commercial banks, which amended-and-restated a $600 million loan from November 2019 that ICBC contributed to (Record ID#111097). AfDB served as Mandated Lead Arranger (MLA) and arranged the DFI tranche. Other participants in the DFI tranche included Japan International Cooperation Agency (JICA), AGTF, the Development Bank of South Africa (DBSA) and Cassa Depositi e Prestiti Spa (CDP). Credit Suisse, acted as co-Mandated Lead Arranger (Co-MLA) and Underwriter, organized the commercial tranche. The Industrial and Commercial Bank of China Limited also joined as an Original Commercial Lender, Co-Mandated Lead Arranger and Joint Commercial Underwriter and Bookrunner ahead of syndication. ICBC’s contribution to the commercial tranche is captured in Record ID #86575. The objective of the PEPs is to roll out a set of measures that will improve productivity per hectare and increase cocoa production levels well above 1 million tonnes per year (versus an average of 800,000 tonnes per year over the last ten years). The PEPs will mainly entail measures to sustainably increase plant fertility, develop irrigation systems, rehabilitate aged and disease-infected farms, increase warehouse capacity, and create an integrated farmer database. The programs will also provide short-term working capital support to local cocoa-processing companies, thus facilitating domestic value addition and consumption of cocoa products in Ghana.