The World Bank is calling for far-reaching reforms to the Ghana Cocoa Board (COCOBOD) Act to promote market-based principles and reduce the financial risks associated with the cocoa sector.

The World Bank Division Director for Ghana, Liberia and Sierra Leone, Robert R. Taliercio , said financial and operational inefficiencies within COCOBOD were placing a strain on farmers and the country’s public finances.

Speaking at the launch of the World Bank’s Tenth Ghana Economic Update in Accra, Mr Taliercio said reforms to the legal and operational framework governing COCOBOD were necessary to ensure the sustainability of the cocoa sector.

“We welcome continued discussion and debate on the Cocoa Board Act, and we suggest that far-reaching reforms of the Act are needed to promote market-based principles and minimise quasi-fiscal risks,” he said.

He said without decisive reforms in the cocoa and energy sectors, some of the fiscal gains achieved under Ghana’s economic reform programme could quickly be eroded.

The World Bank’s call comes amid concerns over the financial position of COCOBOD and the impact of its operations on the government’s finances.

Mr Taliercio said the cocoa sector’s challenges were among the key domestic risks that could undermine Ghana’s economic recovery if not addressed.

He further stressed the need for Ghana to strengthen its fiscal position and reduce reliance on measures that could create additional pressure on public finances.

The World Bank official said Ghana’s economic recovery remained “structurally incomplete” despite significant improvements in key macroeconomic indicators.

He noted that the country’s heavy dependence on cocoa and gold exports also exposes the economy to fluctuations in international commodity prices.

According to him, diversifying Ghana’s export base and implementing reforms that support market-based economic activity would be critical to building a more resilient economy.

The World Bank therefore urged the government to sustain the reform momentum and address structural weaknesses in the cocoa sector to protect fiscal gains and support long-term economic growth.