President John Mahama has urged African governments to stop treating the private sector as an irritant and instead embrace it as the engine of growth.

Speaking at the ongoing 9th Tokyo International Conference on African Development (TICAD IX) on Thursday, he warned that excessive regulation and outdated perceptions continue to hold back innovation and sustainable growth on the continent.

“The public sector must see the private sector as partners and not an irritant,” Mahama said.

“In the past, it was like this sector is just about profit and all that. And so the public sector had tended to crowd out the private sector. Now, everybody uses the Hackney phrase that the private sector is an engine of growth.

"But how does an engine operate if you don’t give it the right fuel, healthy fuel, engine oil, hydraulic oil, for it to be able to operate properly. And so that’s the role of the public sector. We must create a policy that creates the framework for an enabling environment for the private sector to grow.”

Mahama stressed that governments must create the right space for private investors to thrive, pointing out that businesses are not charity organisations.

“The private sector is not Father Christmas. It will go where it can get a good rate of return on investment. And so government must create the space for the public sector to exercise its creativity, and that is what we need to reorient the public sector to do.”

Drawing on his own experience in government, the former president recalled how rigid regulatory systems once suffocated Ghana’s ICT revolution.

“I was Minister of Communications in the early days when the tech ICT sector was exploding and people were coming home and asking for licenses to set up internet cafes, and if you saw our regulator and the conditions you had to meet and all that, I mean, it was just crazy.

"I mean, by the time you go through that list, you’ll not be able to start anything. And so when I became Minister, I said, But why? Why license them? If you want to set up an internet cafe, why don’t you just open it, if you have the investment? And when we did, internet cafes exploded across the country. They didn’t cause any harm. They didn’t lead to any coup d'état.”

Mahama further argued that Africa’s telecom sector was proof that allowing private investment can transform economies.

“When we’re liberalising our telecom space. They said, Oh, telecom is so important. You cannot give it to the private sector. You know, it’s sensitive. The CIA would listen to our conversations and all that. I mean, today, look at the telecom sector. It’s contributing so much to the GDP of Africa’s growth.”

He warned against overregulation, especially in emerging industries driven by young innovators.

“So what we need to do is to create the right environment for the young people to thrive. We should not overregulate. I met with the FinTech last year during the campaign, and I was asking them, What are your problems?

"And they said, over-regulation. Why don’t you ease it up so that we can invest more, and so I think that we must not be too sensitive in guarding and trying to regulate and all that must create the space so that these young people can exercise their creative talents and contribute to sustainable growth in our countries.”