By Gambrah Sampeney KWABENA ADJEI
Ghana’s economic landscape is characterised by a unique blend of indigenous entrepreneurship and modernised corporate structures.
However, the latter, which is heavily influenced by western models, often fails to account for the distinct nuances of the Ghanaian entrepreneurial economy.
This feature seeks to explore the inherent differences between these two economic systems and argue that a more contextual approach is necessary to unlock the full potential of Ghana’s economy.
The Ghanaian entrepreneurial economy
The Ghanaian entrepreneurial economy is built on the principles of self-reliance and adaptability. Entrepreneurs in this space often rely on their own resources to initiate and sustain their businesses, rather than seeking external funding or credit.
This approach is rooted in the reality of limited access to formal credit facilities and the high risks associated with lending in the Ghanaian market.
As a result, Ghanaian entrepreneurs have developed innovative strategies to navigate these challenges. For instance, many businesses begin as small, informal operations, with entrepreneurs selling goods or services in high-traffic areas such as markets or transportation hubs. These micro-enterprises are often cash based, with owners relying on daily sales to sustain their operations.
The limitations of Western style corporate structures
In contrast, Western style corporate structures, which are commonly adopted in Ghana, are designed to protect the interests of investors and ensure the efficient allocation of resources.
These structures typically feature specialised departments – such as finance, accounting and human resources – which are responsible for monitoring and controlling the flow of capital.
However, these structures are often ill-suited to the Ghanaian entrepreneurial economy, where access to formal credit is limited and businesses are frequently cash-based. The rigid regulations and bureaucratic processes that accompany Western style corporate structures can stifle innovation and hinder the growth of indigenous businesses.
The need for contextual reforms
To unlock the full potential of Ghana’s economy, it is essential to develop a more nuanced understanding of the country’s entrepreneurial ecosystem. This requires a shift away from the rigid structures and regulations that characterise Western style corporate governance toward a more flexible, adaptive approach that is tailored to the unique needs and circumstances of Ghanaian entrepreneurs.
By embracing the indigenous entrepreneurial economy and providing targeted support to micro enterprises and small businesses, the government can help to stimulate economic growth, create jobs and reduce poverty. This may involve initiatives such as:
- Simpliying regulatory processes and reducing bureaucratic hurdles for small businesses.
- Providing access to training, establishing specialised financial models that cater for the needs of micro enterprises and small businesses
- Promoting the development of indigenous industries and value chains.
Ghana’s entrepreneurial economy is a unique and resilient entity that has the potential to drive economic growth and development and, to large extent, stabilise the currency. However, to realise this potential, it is essential to develop a more nuanced understanding of the country’s entrepreneurial ecosystem and to implement contextual reforms that are tailored to the needs and circumstances of Ghanaian entrepreneurs.
