Youth Economic Dialogue (YED) has commended government for proposing Ghs50 million Fund to address limited access to financing and reducing the cost of borrowing by Small and Medium scale Enterprises (SMEs) in Ghana.

In a statement issued in Accra Monday, the group said there is growing amount of evidence that, the most serious obstacle hindering the growth and development of Small and Medium Enterprises, is the cost of credit.

While agreeing that this initiative is in the right direction, “YED wishes to draw the government’s attention to its abysmal track record of effective implementation of such programmes and policies since the days of Economic Recovery Program and Structural Adjustment Programme”. 

 

Below is the full statement

YOUTH ECONOMIC DIALOGUE

PRESS STATEMENT ON THE 2014 BUDGET AND ECONOMIC POLICY

 

GH₵50 MILLION SME FUND COMMENDABLE BUT..............

Youth Economic Dialogue commends the government for proposing to set up a Gh₵50million SME Fund to address limited access to financing and reducing the cost of borrowing by Small and Medium Enterprises in Ghana. There is growing amount of evidence that, the most serious obstacle hindering the growth and development of Small and Medium Enterprises is the cost of credit. While agreeing that, this initiative is in the right direction, the group wishes to draw the government’s attention to its abysmal track record of effective implementation of such programmes and policies since the days of Economic Recovery Program and Structural Adjustment Programme.

In order to avoid the episode that was witnessed during the implementation of Business Assistance Fund, which was similarly set up to provide direct government lending to Small and Medium Enterprises, but widely seen to have been abused politically with significant amount of the loans going to perceived government supporters, Youth Economic Dialogue recommends that the whole quantum amount be administered by a banking institution with nationwide coverage and supervised by the National Board for Small Scale Industry (NBSSI). In our humble opinion, this will enhance debt recovery and promote transparency and inclusiveness.

The group is extremely excited about the proposed establishment of three Business Incubation Centres in Accra, Kumasi and Tamale under the auspices of NBSSI. We encourage the youth to take advantage of this opportunity in order to commercialize their innovative skills as well as create job opportunities for others. We strongly want to take this opportunity to remind the government that, our group will monitor the implementation of this facility closely.

RESEARCH AND INNOVATION FACILITY

Youth Economic Dialogue believes that Ghana’s developmental agenda can be greatly improved when teaching and learning are contextualized within our socio-economic environment. Our Universities and other institutions of higher learning therefore require support to undertake quality research hence we commend this initiative.

Youth Economic Dialogue makes the following recommendations in implementing this facility:

• Increase the funding amount for research by soliciting for funds from the private sector.
• The modalities being developed should include measures to encourage collaborative research between industry and faculty members. This will lead to the production of research works that are not merely academic exercises but also relevant to industry.
• Decentralize the scheme for allocation of funds to avoid the problem of inertia. The current structure as exists in our universities (Research and Conferences Committee) can be used with a National Oversight Committee made up of technical and private sector managers can be explored.
• Finally, some amount of money should be paid to all lecturers as Book Allowance to aid faculty members to keep up with modern and more relevant trends in their various fields of specialization.

 

Signed by

Nana Yaw Adutwum                                                                      Davis Adu-Larbi     

Country Director                                                                             Policy Analyst