Loan syndication and cocoa production: Evidence from Ghana
Syndication of loan is an innovative financing model that has emerged in the financial landscapes to help lenders spread risk and share opportunity. This study examined the relationship between syndicated loan and cocoa production in Ghana, using annual time series data spanning from 1993 to 2020 and obtained from the Bank of Ghana annual reports and Ghana Cocoa Board. The data collected was fitted to Cobb-Douglas production function and Autoregressive Distributed Lag model. The study found that syndicated loan has a positive and significant relationship with cocoa production, both in the short-run and long-run. It also found a unidirectional causality from syndicated loan to cocoa production. Ghana Cocoa Board should put in place effective systems to ensure efficient use and management of syndicated loans obtained, and build trust through timely payment of the loans to ensure its continuous receipt to increase cocoa production in the short and long run.