The novel coronavirus has impacted most economies negatively since it disrupted global economic activity.
Worst-affected are Micro, Small and Medium Enterprises (MSMEs), which account for 70 percent of Ghana’s Gross Domestic Product (GDP) while also forming about 92 percent of businesses in the country.
This week President Akufo-Addo launched the ‘CAP Business Support Scheme’, which forms part of the Coronavirus Alleviation Programme – a GH¢1.2 billion programme introduced to protect households and livelihoods, support MSMEs, minimise jobs losses among others – at Jubilee House.
Out of the GH¢1.2billion earmarked for this programme, GH¢600million will be disbursed as soft loans to MSMEs with an up to one-year moratorium and a two-year repayment period. The rate of interest on government’s GH¢600million facility is 3 percent.
Finance Minister Ken Ofori Atta stated that the Business Support Scheme is the cue to begin an aggressive normalisation of the economy. He advised beneficiaries of the scheme that they should properly invest the money so it bears more fruit to feed many people.
Since the programme is a nationwide endeavour and the president assured that transparency and accountability will be the hallmark of the scheme’s operation, it gives some hope that all entities which suffered as a result of the COVID-19 outbreak are entitled to some of stimulus package-aid to revive their activities.
The onus rests on the beneficiaries to use whatever monies they receive judiciously, since this is not free money. The programme is targetted at MSMEs in both the formal and informal sectors, and is expected to attract over 180,000 beneficiaries.
The allocation of funds is to be supervised by a Loans Committee comprised of one representative each from the Ministries of Trade and Industry and Finance, the NBSSI and participating banks, with the KPMG acting as technical advisor to the scheme.
This engenders hope that the scheme will be above-board and go to benefit those earmarked to receive the package. We believe that with this package, businesses can return to activity soon – particularly as there is an indication that the economy will return to normalcy once restrictions are eased at the end of this month.
Already, there are discussions on how to open-up schools and control other social gatherings. We believe some smiles will soon return to those operating within the MSME sector of the economy.