The Ghanaian Small and Medium Enterprises (SMEs) sector, according to Abena Amoah, Deputy Managing Director of the Ghana Stock Exchange (GSE), is the key to the sustainability of the country’s economy.
Ms. Amoah advocated for the establishment of purposeful measures to assist the sector’s growth, noting that over 90% of enterprises in the nation are SMEs and that they collectively account for at least 70% of the GDP.
“SMEs are the backbone, the foundation and true engine of growth of the Ghanaian economy…and Ghana will not grow without SMEs growing strongly,” the deputy managing director of the GSE said when speaking at a capacity building workshop for SMEs organised by the Association of Ghana Industries (AGI) in partnership with the Exchange and Development Bank of Ghana (DBG) under the theme ‘Empowering SMEs with key strategies for resilience and business sustainability’.
“It is against this background that the GSE and DBG want to move beyond the rhetoric and work with your association, AGI, to prepare local businesses through capacity-building programmes to raise the much-needed patient and affordable capital to catapult and accelerate their growth and that of the economy,” she added.
She said the GSE has set up three markets so far to support the raising of patient capital by SMEs – the Main Market to attract new shareholders for medium to large companies; the Ghana Fixed Income Market to raise long-term patient corporate debt financing; and the Ghana Alternative Market, specifically to provide a platform for SMEs to raise share capital and list their shares for trading on this market.
On his part, Deputy Chief Executive Officer (CEO) of the Development Bank of Ghana (DBG), Michael Mensah-Baah, reiterated the bank’s commitment to supporting transformation and growth of the private sector.
And for the SMEs to lead the country’s economic recovery amid recent downgrades by Fitch Ratings and Moody’s, he said, DBG will lead the acceleration of inclusive and sustainable economic transformation by fostering a competitive private sector wherein SMEs are the main players.
“We are not in normal times, and globally all countries are struggling. So anything that we do, there must be a sense of urgency associated with it. We want to be inclusive and the outcome of our interventions must touch everyone,” he remarked during the AGI-led capacity-building workshop.
He said supporting the growth of SMEs and the private sector to withstand shocks of the current global economic turmoil is critical to the country’s recovery and sustainability.
“The mindset that long-term funding is all that’s needed for you to grow your businesses is not accurate. You need to have skills that enable you to be sustainable over time. So, DBG provides long-term funding at competitive pricing – but we also believe that it’s important to empower and upscale businesses in a way that makes them sustainable,” Mr. Mensah-Baah said.
For president of the AGI, Dr. Humphrey Kwesi Ayim-Darke, the collaboration between his outfit, GSE, and DBG will aid SMEs with what he described as “reasonable” medium to long-term funds injected into their businesses, so as to design and manufacture quality products that are exportable to the African region.
Meanwhile, DBG signed a tripartite memorandum of understanding with the Association of Ghana Industries and Ghana Stock Exchange as part of its mandate of building capacity and empowering banks and entrepreneurs through financial innovation and other advisory services to strengthen the ecosystem in which businesses operate.
Commenting on the development, Mr. Mensah-Baah intimated that: “A critical role here for DBG is to provide long-term funding to banks and engaging in partnerships with institutions like AGI and GSE to ensure private sector empowerment for growth”.
This collaboration with partners seeks to fashion innovative solutions which demonstrate that principles and profits are not mutually exclusive.