Former Finance Minister and Karaga MP, Dr Mohammed Amin Adam, has criticised the government’s decision to reduce the producer price of cocoa, arguing that the struggling sector required a financial bailout rather than a cut in payments to farmers.
Speaking shortly after the Finance Minister, Dr Cassiel Ato Forson, announced the new cocoa price, Dr Amin Adam described the move as deeply troubling, particularly at a time when the government maintains that the economy is stable and resilient.
According to him, the scale of challenges confronting the cocoa sector should have prompted direct financial support to the Ghana Cocoa Board instead of shifting the burden onto farmers.
“Given the scale of the crisis in the sector now a sector which is one of the most important pillars of our economy one expected the government to give Cocoa Board a bailout, as we did during the NPP time, rather than reducing the producer price for cocoa,” he stated.
He stressed that cutting the producer price sends the wrong signal about the health of the economy. “A bailout would have been necessary, particularly at the time we are told that the economy is strong and resilient. They said they are better managers of the economy,” he remarked.
Dr Amin Adam also took aim at the International Monetary Fund (IMF), expressing surprise at what he perceives as the Fund’s silence on the matter. He noted that the cocoa sector recovery strategy was developed in consultation with the IMF as part of programme requirements.
“I’m really surprised that the IMF has gone to sleep on this,” he said, adding that the government’s current handling of the sector has led to what he described as an “unprecedented crisis.”
Beyond the producer price issue, the former Finance Minister criticised what he called the government’s “reckless overvaluation” of the cedi. He argued that heavy foreign exchange interventions which he claimed amounted to about $10 billion last year risk undermining Ghana’s export competitiveness.
“When you overvalue your currency, it adversely affects the export competitiveness of your country,” he explained. “Anytime you are implementing a policy, there are trade-offs.”
He urged the government to pursue what he termed “policy equilibrium,” warning that excessive focus on currency stabilisation without regard for its wider impact could hurt key sectors such as cocoa.
