Mr President, Is Bank of Ghana deliberately killing MSEs in Ghana?
Ghana has had its fair share of policy decisions that have disrupted the development of our economy and shortchanged its citizens and children.
Advertisement
For this reason, I have often wondered: How far-sighted is the vision and how deep is the commitment? In the next decade or so, will our children call themselves proud citizens of Ghana or have our leaders sold them out in their scramble for crumbs of bait thrown at them by foreign nationals? What does the ordinary Ghanaian count for apart from his ‘vote’? What would President Atta Mills of blessed memory have done differently had he known he had only one term to serve? And are ex-Presidents J.A. Kufuor and J.J. Rawlings truly content with the legacies they left?
The Bank of Ghana (BOG), which in recent times enacted certain policies that have adversely affected trade, cost of living and the banking industry itself by driving investors to choose alternative ways to manage their incomes, has dealt yet another blow to micro and small enterprises (MSEs).
Even before the entry of foreign investors into the field, Ghanaians who owned micro ‘susu’ and lending schemes provided the informal sector in Ghana with the much-needed funding and savings support at the time when banks showed no interest in that bracket of the population perceived to be too ‘poor’ to be of value. Today, thanks to those schemes, the informal sector has grown to become the largest income earner in Ghana.
I was, therefore, deeply disappointment when I learnt that the BOG had increased the minimum capital for running a microfinance institution (MFI) from GH¢100,000.00 to a whopping GH¢500,000.00. This policy, no doubt, seeks to cut off majority of Ghanaian-owned MFIs in favour of the larger banks and foreign investors such as Beige Capital, Opportunity Bank, the Pro-Credits and what have yous.
I am told Nigerian leaders have enforced laws that make it very difficult for Ghanaians and other foreigners to own and run businesses, including churches in Nigeria. And even when such businesses and churches exist, the Nigerian market hardly patronises them. The situation is no in China and India, among others.
Free market is not a bad thing. However, there is a fine balance of distinction between opening up Ghana’s market and playing whoredom with the treasures of our beloved country such as our natural resources, industry and human capital. It is whoredom of grave consequences when institutional heads entrusted with mandates to make prudent, well thought-out decisions for the benefit of Ghanaians rather porn the soul of this nation; our gold, energy, education, industry and human resources for a pittance to the benefit of foreign nationals and their children.
Conversely, it is refreshing to watch the leadership of emerging markets such as China, India, Brazil and Nigeria aggressively take pains to actualise the creation of enabling environments for its citizens, particularly its youth, encouraging them to start up, grow, expand and multiply businesses and open branches in foreign lands such as Ghana, so that they can in turn replenish their respective homelands with repatriated profits. Regrettably, such an environment still remains obscure in the imaginations of many of the youth of Ghana today.
Mr President, please lend me your good ears: How can MSE’s which form the majority of Ghanaian-owned businesses, howbeit informal, hope to establish, legitimise and grow respectable thriving firms if we are soon cut off? How can we compete and provide education, hope, employment, self-esteem, confidence and opportunities for our children if we are marginalised, removed and excluded from the playing field with hostile policies because we are perceived not “fit” for a perceived class of big players? Moreover, is it not true that MFIs emerged from the informal sector’s traditional ‘susu’ and loans schemes run by community members? How is it then that having witnessed the potential of this market, the BOG now seeks to exclude Ghanaian-owned MSEs? How many Ghanaian-owned MSEs have GH¢500,000.00 as seed capital? Hence, H. L. Menken’s assertion, “For every problem there is a solution”, is simple, neat and not wrong.
The role of MFIs is two-pronged: To educate the borrower in best business practices and provide affordable loans and ‘susu’ schemes. One of the better solutions, Mr President, would be to upgrade, invigorate and empower existing establishments such as the National Board for Small Scale Industries (NBSSI) with an oversight role and a mandate to harness wealth creation from the Ghanaian informal sector into formal respectable and competitive engines of national growth. The NBSSI has demonstrated knowledge and expertise in capacity building, streamlining and harnessing MSE formation and growth countrywide, including the management of small loan schemes, through their Business Advisory Centres. They are, therefore, well positioned to monitor and help streamline the activities and benefits of small Ghanaian-owned MFIs and weed out fraudulent actors in the market.
Mr President, I hope that you will favour my petition and take encouraging actions to include, support, equip and empower Ghanaian-owned micro and small business owners/operators to eventually become stalwarts within their own rights for the benefit and development of Ghana and its citizens.