Deliberately growing SMEs to become giants
TheGraphic-Access Bank Small and Medium Enterprises (SME) ended in Accra last Saturday with a call on the government to be deliberate about growing small and medium enterprises (SMEs) to become global giants.
A professor of Finance at the University of Ghana, Godfred Bokpin, who made the call, said SMEs were capable of providing the projected 10 million decent jobs needed in the country by 2040 at a time many of the people are projected to be below 30 years.
Over 150 exhibitors participated in the fair, which was on the theme: “Enhancing SMEs’ access to markets for sustainable growth.” It boosted the capacity of small and medium enterprises and their contribution to economic growth and development.
Owners of SMEs, corporate leaders, captains of industry and consultants in the SME space provided tailor-made solutions to business advisory services for participating local entrepreneurs regarding challenges confronting their businesses.
Again, the fair will build on the capacity of SMEs for them to play their role in the national transformation agenda.
The success of the fair solidifies the strategic partnership between the Graphic Communications Group Limited and Access Bank to provide better chances of survival for SMEs during perilous economic times.
This is because SMEs play a significant role in the country’s economy. Over 70 per cent of business enterprises in the country are SMEs. They do not only form around 80 per cent of the total employment in the country but also account for some 60 per cent of the country's GDP.
For us, access to financing continues to be one of the most significant challenges for the creation, survival and growth of SMEs, especially innovative ones.
The problem is strongly exacerbated by the financial and economic crisis as SMEs and entrepreneurs have suffered a double shock with a drastic drop in demand for goods and services and a tightening in credit terms, which are severely affecting their cash flows.
To overcome this challenge, the government must aim at supporting sales and preventing depletion of SMEs’ working capital, enhance their access to liquidity and help them to maintain their investment level.
Again, the government should integrate the development of SMEs' through trade and investment, in the broader national development strategy and/or poverty reduction and growth policies of the country as a significant pathway for the success of the sector.
The establishment of industrial parks and business incubators are also essential to providing appropriate development services to SMEs in simple technological application and innovation as well as launching cluster initiatives to enhance their global competitiveness while boosting enterprises' profits, capacities for employment and higher productivity. Capacity-building is crucial for the survival of SMEs.
This is because these business units are usually owner-managed, and most owners have little managerial expertise, including knowledge and skills to direct firms' success.
The incorporation of SMEs into local, national and global markets is vital for growth and expansion since large and ready markets availability will influence enhanced production of goods and services and capacity through technology innovation application.
This support, in addition to the Access Bank-Graphic SME fair, will go a long way to boost the growth of the sector.
We therefore call for a deepening of the partnership between the Graphic Communications Group and Access Bank to spur the growth and development of SMEs.