Dr. Mohammed Amin Adam, the Finance Minister, has expressed confidence in Ghana's economic recovery, highlighting significant milestones achieved in the government's reform agenda.
Speaking at the second Quarterly Economic Roundtable hosted in partnership with the University of Ghana, Dr. Amin Adam outlined the country's economic growth trajectory and emphasized the government's commitment to strengthening Small and Medium Enterprises (SMEs), which he described as the "backbone of the economy."
"The feedback from our maiden Roundtable in July has been overwhelmingly positive," Dr. Amin Adam noted, referencing the theme of the previous meeting, Restoring Macroeconomic Stability, led by keynote speaker Dr. Nii Kwaku Sowa.
"We took decisive actions after that meeting, incorporating key proposals into the 2024 Mid-Year Budget. These have shaped our ongoing fiscal reforms and entrepreneurship support programs."
Ghana's economy, according to the Finance Minister, has exceeded growth expectations, with a half-year growth rate of 5.8%, the highest in the last five years.
"This impressive growth, particularly in Q2, was driven by industry, agriculture, and services sectors," he said, adding that the government’s policies to support private sector actors, especially SMEs, are yielding positive results.
As the focus of the Roundtable shifted to driving economic growth through SMEs, Dr. Amin Adam stressed their pivotal role in the economy, contributing 70% of GDP and making up 92% of businesses in the country.
However, he acknowledged the persistent challenges SMEs face, including access to finance, markets, business development support, and complex tax systems.
In response, the Finance Minister unveiled the GH¢8.2 billion SME Growth and Opportunity Programme (SME-GO), launched by President Akufo-Addo in July.
This initiative, supported by strategic partnerships with the African Development Bank and the International Finance Corporation, aims to empower SMEs to leverage regional and global markets.
The program also complements existing projects like the US$200 million Ghana Jobs and Skills Project and the US$200 million Ghana Economic Transformation Project.
“Our government has operationalized various private sector-focused interventions to boost SME growth, such as the Ghana Enterprises Agency, the National Entrepreneurship and Innovation Programme, and the Venture Capital Trust Fund,” Dr. Amin Adam remarked.
“These institutions are key to providing comprehensive support to SMEs, ensuring their resilience and growth.”
Dr. Amin Adam further highlighted recent milestones in Ghana’s economic restructuring, including the successful conclusion of external debt negotiations, where the government secured over 98% consent from bondholders, surpassing its 65% target.
This success, he noted, will lead to an immediate reduction of US$5 billion in principal payments and US$4.3 billion in debt service relief between 2023 and 2026.
Additionally, the International Monetary Fund (IMF) recently granted a Staff Level Agreement (SLA) following the third review of its support program, paving the way for the release of a US$360 million tranche.
This will bring total IMF disbursements under the program to US$1.92 billion, further bolstering Ghana’s economic reforms.
The Finance Minister concluded by acknowledging the crucial role infrastructure development, such as the Accra-Tema Motorway redevelopment and the Tema-Akosombo Railway, will play in reducing transaction costs for SMEs and improving market access.
"Our SMEs are at the heart of our economic strategy. We are committed to ensuring their success and to building a transformed future with them at the center," he affirmed.
Dr. Amin Adam also praised the keynote speaker, Emeritus Professor Ernest Aryeetey, for setting a constructive tone for the discussion, reaffirming the government’s determination to foster partnerships and leadership that will drive sustainable growth.
"As we meet today, let us be guided by our unity of purpose. Together, we will build a stronger economy, with SMEs leading the way to job creation, income generation, and national prosperity,"
On her part, Prof. Nana Aba Appiah Amfo, Vice-Chancellor of the University of Ghana, has underscored the vital role of Small and Medium Enterprises (SMEs) in driving Ghana’s economic growth.
Prof. Amfo emphasized the need for strategic policies to foster innovation and create a more conducive environment for SME growth.
"SMEs are the backbone of our economy, contributing significantly to GDP and providing jobs. Yet, they face numerous challenges such as regulatory hurdles, limited access to finance, complex tax systems, and high utility tariffs," she noted.
Prof. Amfo also highlighted the importance of integrating SMEs into the career plans of young graduates, noting that the formal sectors cannot absorb the growing number of graduates entering the job market.
"SMEs must be seen as a viable option for these graduates," she said.
She commended the collaboration between the University of Ghana, government agencies, and industry practitioners in shaping policy through the Quarterly Economic Roundtable.
"This platform aligns with our university's vision to achieve global impact through research, teaching, and partnerships, and provides us with the opportunity to influence public policy and national development," Prof. Amfo stated.
She urged participants to contribute actively to the discussions and to focus on concrete outcomes that will improve the business environment for SMEs and enhance Ghana's economic potential.
Prof. Amfo encouraged visitors to explore the University of Ghana campus and invited alumni to engage actively in the institution's programs through the Alumni Association.
"Together, we can unlock the full potential of SMEs and drive sustainable economic growth for Ghana,"
On his part, Kyle Kelhofer, Senior Country Manager of the International Finance Corporation (IFC), has reiterated the crucial role Small and Medium Enterprises (SMEs) play in Ghana’s economic transformation.
Mr. Kelhofer highlighted the importance of creating an enabling environment to unlock the full potential of SMEs, which contribute significantly to job creation, innovation, and the country's GDP.
"The importance of SMEs in Ghana’s economic transformation is undeniable. They form the majority of businesses, drive job creation, and play a key role in contributing to the nation’s GDP. This roundtable reinforces the need for continued support and innovation to help SMEs thrive," Mr. Kelhofer stated.
He emphasized the essential collaboration between academia, government, and financial institutions in driving innovation and developing sustainable solutions for SME financing.
"Academia provides valuable research and insights that can inform financial products tailored to SMEs. By working together, we can develop innovative models and create an environment for SMEs to succeed," he added.
Mr. Kelhofer noted that the IFC has been deeply committed to SME development in Ghana, having invested nearly $2 billion in critical sectors over the past decade.
In the past year alone, the IFC committed over $400 million in investments, with $150 million directed toward SMEs through intermediary banks to enhance access to funding.
"Much work remains to build the capacity of SMEs, but IFC is committed to unlocking their full potential, particularly through initiatives supporting women-owned enterprises," he said, stressing the importance of empowering these businesses to drive sustainable economic growth.
Mr. Kelhofer also highlighted IFC's innovative platforms, such as the Ghana Collateral Registry, developed in partnership with SECO and the Bank of Ghana, which enables SMEs to use movable assets as collateral, improving access to finance.
"In conclusion, driving economic growth through SMEs requires a concerted effort from all stakeholders. Together, we can create a robust ecosystem that supports SMEs and promotes sustainable development,"
Story by: Joshua Kwabena Smith
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