All funding schemes for Small and Medium Scale Enterprises should be merged into one to ensure that a substantial pool of funds is created to shore-up the sector, Ebenezer Ato Barnes, a consultant working on the draft National MSME policy has suggested.
“We have a lot of SME funds scattered all over the place – we have the Masloc, and we have so many other funds. Development partners, sometimes in order to help MSMEs, develop some funds and all that because we have not centralised it – and even some of them have become a little political.
“So, we need to consolidate all of these funds into one big fund; and under EDA they will be able to have quantum of funds, so when they go to EDA it is a one stop shop. They will help you with business development services and they can help you financially,” Mr. Barnes told B&FT in an interview at a stakeholder consultative workshop on the draft national MSME policy.
The draft MSME policy is aimed at providing the necessary regulatory, institutional, legal and administrative framework for growth and development of the sector, and is expected to be presented to Cabinet before end of the year.
Deputy Minister for Trade and Industry, Carlos Ahenkorah, indicated that 9 out of 10 businesses in Ghana are MSMEs – and policies over the years have not strengthened them.
He also added that the policy objectives are also intended to strengthen the National Board for Small Scale Industries (NBSSI) and its implementing arm toward job creation in peri-urban and rural areas, as well as formalising the informal sector.
Nicolas Gebara, the BUSAC fund manager – one of the partners of the policy, stated that a policy drive to grow SMEs must be triggered if long-term sustainable economic development and transformation of Ghana is to be realised.
“Companies classified as SMEs must be assisted to develop in order to maximise their potential and contribute to economic development of the country,” he said.
The draft policy addresses key challenges facing the MSMEs: including access to financing, deficiencies in managerial and skills capacities, access to market opportunities, and lack of a framework for nurturing entrepreneurship in Ghana.
Among the policy prescriptions contained in the draft is the conversion and resourcing of the National Board for Small Scale Industries (NBSSI) into an Enterprise Development Authority (EDA), to serve as the umbrella-body for MSME development and promotion.
Government will review existing tax legislations to include incentives such as tax-breaks and exemptions for MSMEs.
On access to finance, the policy prescribes that government re-orients and encourages financial institutions, export finance institutions and leasing companies to scale-up lending for MSMEs.
The MSME policy proposes specific policy measures in nine areas of MSME development, including MSME definition, business environment, access to finance, human resource development, modernisation-technology and innovation, market opportunities, entrepreneurship development and cross-cutting issues.
It also identifies key sectors which require tailored support to serve as growth-poles for transformation of the MSME sector.
The key strategic sectors targetted include: agribusiness, manufacturing, information and communication technology (ICT), energy and petroleum, real estate, tourism and creative arts, textiles and garments, artisanal enterprises, services, climate change, and the green economy.