SONA: Cocoa Sector Reforms Necessary Despite Painful Impact — Mahama

President John Dramani Mahama has defended the government’s decision to revise the producer price of cocoa, describing the move as a necessary economic reform aimed at stabilizing the sector and protecting Ghana’s long-term financial future, despite the short-term challenges it may create for farmers.

Addressing Parliament during the State of the Nation Address (SONA), President Mahama acknowledged the concerns of cocoa farmers following the price adjustment but stressed that the decision was unavoidable due to liquidity pressures in the sector.

“In the last week, we have had to take the painful but necessary decision to revise the producer price of cocoa to achieve competitive pricing and resolve the acute liquidity challenges in the sector,” President Mahama stated.

He explained that the government faced a difficult economic choice, noting that failure to implement the reforms would have forced the country into additional borrowing, potentially worsening Ghana’s debt situation.

“Failure to do this would have meant borrowing billions in borrowed funds. This unplanned expenditure would have taken us right back to the very devastating economic problem we have only recently begun to escape,” he said.

President Mahama further revealed that previous economic challenges had placed significant financial strain on the national budget, making prudent fiscal management essential to sustain economic recovery.

He assured cocoa farmers that the reforms are not intended to disadvantage them but rather to ensure sustainable and fair returns for their labour.

“While fully understanding the concerns and protests of our farmers, I can firmly assure them that the reforms announced by government will see a total transformation of the cocoa sector,” he said.

According to the President, the restructured pricing system will provide greater transparency and help farmers maintain decent profit margins while covering the cost of production.

“It will guarantee them a fair and transparent price that enables them to meet the cost of producing the commodity and making decent margins,” he added.

President Mahama emphasized that economic leadership requires making tough decisions to protect the broader population from future hardship.

“The difference between economic hardship and avoiding the same is the exercise of sound economic judgment. And I’m determined to take decisions that ensure our collective well-being and avoid the suffering of all our citizens,” he stated.

He acknowledged that the reforms may be unpopular in the short term but insisted they were necessary to secure Ghana’s economic transformation and ensure the sustainability of the cocoa sector, which remains a key contributor to foreign exchange earnings and rural livelihoods.

“These are difficult decisions to take, but I had to take them,” he concluded.