SPIO PUSHES FOR MORE SME SUPPORT

Ekwow Spio-Garbrah with GroFin and the ministry’s officials after the meeting 

Posted on: www.dailyguideghana.com

By William Yaw Owusu

Tuesday, June 07, 2016

Trade and Industry Minister Ekwow Spio-Garbrah is advocating the setting up of what he terms ‘Project Development Clearing House’ to create the platform for rejected Small and Medium Enterprises (SMEs) to redefine their proposals to enable them to attract financial support from the banks.

According to the minister, the issue of funding for SMEs has become Ghana’s biggest challenge but creating a platform to enable them to re-engage the financial institutions would help to reduce unemployment and boost economic growth.

Mr Spio-Garbrah made the comments when a team from GroFin, an influential financial services institution supporting vibrant SMEs, led by their Regional Investment Director for West Africa, Gwen Abiola-Oloke, paid a courtesy call on him at the ministry in Accra on Friday.

The minister said “we should be able to create an environment where the borrower accepts that the rejected information can be sent to this project development clearing house which over a period of time we will get an accumulation of these so-called rejected projects, database them by sector and by region.”

He said “when it happens we can know that for example 35 poultry projects have been rejected, 17 property development project, 13 fish processing projects, ginger project horticulture etc. have been rejected so that we can know which of these projects can potentially become viable and in some cases by knocking two or three projects together we can secure some capital for the SME sector to grow.”

Dr. Spio-Garbrah said using such an approach could “save a lot of beautiful projects that are being rejected everyday by the financial institutions and which have nowhere else to turn to.”

“It is a matter of whether there are enough interests among the banks to work with us in that respect. Where do all those declined projects go to? We don’t have to frustrate potential business people by letting them have negative reactions all the time about how to secure funds for their projects.”

He also said “we need a think tank of young and also experienced sometimes retired business people who can look at some of these projects and do something to them because always every project is viable if professional touch is given to such projects.”

Mrs. Abiola-Oloke and her team which included GroFin Ghana officials took turns to explain the workings of the impact lending financial institution to the minister and top officials at the ministry.

She said the unique combination of appropriate finance and hands-on business support from GroFin is helping the private sector to remain in business and create employment.

“Our proven model helps unserved and underserved entrepreneurs gain access to both the money and the expertise that they need to succeed,” adding “we have been able to transform the failure rate of SMEs from the World Bank estimated 70-90 percent to a GroFin success rate of 80 percent, ensuring that sustainable SMEs do not only survive but grow.”

 “Globally, Africa lags behind other developing regions in financial inclusion. Financial inclusion is critical to achieving poverty alleviation, sustainable economic growth and social cohesion.

“Such wide gaps in financial inclusion impede inclusive growth in Africa, a situation already exacerbated by an excessive reliance on natural resources for growth.”