Ghana can attract high value investors if...
The Country Director of Technoserve, Mr Samuel Baba Adongo, has said the economy can attract high value investments if it is able to empower its local entrepreneurs to match the capacities of potential external investors.
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Mr Adongo said this at the maiden edition of an investors and financial dialogue session with selected local entrepreneurs who are currently receiving support from Technoserve through its project dubbed: “Enhancing Growth in New Enterprises” (ENGINE) in Accra.
The session was aimed at providing opportunities for investors to meet and interact with some promising entrepreneurs identified through the ENGINE programme.
Financial dialogue
It also provided an opportunity to network and initiate the development of a new portfolio in the Small Medium Enterprises (SME) sector, while creating a network of investors and financiers who could provide credit facilities to support SME businesses under the programme.
The session attracted participants from the banking sector, savings and loans companies, impact funds, private equity firms, venture capital Firms, microfinance institutions and other specialised funding agencies.
Many of the financial institutions that were at the session implored Technoserve and other stakeholders to support an initiative that provided cash and “in-kind” awards in the form of seed capital and aftercare support services to SMEs.
The intervention, according to them, will allay the fear of providing credit facilities to SMEs that are mostly start-ups.
Challenges
Mr Samuel Adongo noted that Ghana had achieved significant economic development in the last two decades averaging growth of 5 per cent per year. This, he said, had been underpinned by strong export markets for gold, cocoa and recently oil.
“However, while future growth prospects are strong and oil and gas production is expected to increase, the economy is becoming increasingly unbalanced and vulnerable to external shocks,” he added.
According to him, manufacturing in the country is declining and there is a dearth of medium-sized companies, which contributes to the relative lack of productivity and failure to attract investment that mark Ghana out in comparison to its peers.
He said a vast majority of jobs in developing economies were provided by micro and small enterprises (MSEs) and there was good evidence that the growth of young, small firms was a driver of economic growth.
“There is a very strong culture of entrepreneurial activity in Ghana as evidenced both by the high prevalence of owner-managed firms and by the high value placed on it as a career choice,” he said.
He said the market had failed to nurture entrepreneurship particularly among start-up, and once an MSE had failed to grow in its first few years, it was less likely to do so later.
Future perspective
According to him, the country can only see a significant growth in the economy if the SME sector is given the needed support to grow.
He said the aim of the ENGINE’s support programme was to enhance the growth and productivity of start-up MSE’s defined as young enterprises of less than three years that initially employ less than 20 people.
He said the project was expected to provide jobs for over 1,770 individuals and further increase revenue growth of 500 MSEs by an average of 400 per cent.
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