Ghana plans to invest US$500M to strengthen its oil palm sector

Ghana plans to invest US$500 million to strengthen its oil palm sector as part of an ambitious strategy to reduce dependence on imports and boost domestic production.

The Ghanaian government announced this investment framework in its 2026 Budget and Economic Policy Statement, aiming to transform the country into a self-sufficient producer of palm oil.

Ghana currently produces about 70% of its palm oil needs but still imports roughly 30% to cover domestic consumption, spending nearly US$200 million annually on imports.

The investment will be implemented through the National Integrated Palm Oil Development Policy for 2026-2032, developed collaboratively with the World Bank, Ghana Development Bank, and other finance institutions.

The policy includes a long-term financing facility offering concessional loans with a five-year repayment moratorium and the ability to finance up to 70% of industrial project costs.

This patient, an affordable capital model, is crucial to support oil palm cultivation, which takes about seven years to reach full maturity.

The government’s plan seeks to attract both local and foreign investors while expanding plantations.

It includes developing 100,000 hectares of new oil palm estates to increase the supply of raw materials for processing plants.

In 2025, Ghana signed a public-private partnership with Onesta Ghana Ltd., mobilizing US$50 million to develop and operate 10,000 hectares under the “Redgold Oil Palm Plantation Project,” aiming to enhance production and processing capacity.

Smallholder farmers are prioritized under this policy as essential partners in the supply chain. The government will provide improved seedlings, subsidized fertilizers, guaranteed off-take contracts, financing, and training to organized cooperative farmers.

Specific support mechanisms, such as a Smallholder Support Fund, aim to improve access to affordable credit and skills training, particularly for women and youth, to replicate successful integration models seen in Indonesia and Malaysia, the world’s leading palm oil producers.

Challenges remain, including illegal imports that undermine local producers and discourage investment in expanding plantations.

Industry bodies estimate that 90% of cooking oils in Ghana are illegally imported, evading quality control and taxes.

The government aims to curb smuggling to protect domestic production and encourage sustainable industry growth.

Ghana’s US$500 million investment in the oil palm sector represents a comprehensive effort to boost production capacity, support small farmers, attract private investors, and reduce costly import dependency, creating jobs and fostering economic growth in this vital agricultural industry.

Tags: Production, investment, palm oil, imports, oil palm, Ghana, consumption