A research report has recommended policy support for Small and Medium Enterprises (SMEs) to be competitive in participating in the African Continental Free Trade Area (AfCFTA).
The report said the support should focus on cheaper and more innovative trade finance products, trade policy, trade infrastructure, improved capacity, trade information and facilitation, market access for growth and expansion of SMEs in the country.
Ghana was selected as the country to host the secretariat of the AfCFTA, which starts in 2021.
The AfCFTA provides the opportunity for Africa to create the world’s largest free trade area, with the potential to unite 1.3 billion people, in a $2.5 trillion economic bloc in ushering in a new era of development.
Dr Samuel Frimpong Boateng, the Lead Consultant for the Research made these recommendations at a stakeholder workshop on the report titled “Mobilising Diagnostics Data to Inform Bottom-Up Decisions on Government Policies.”
The report was conducted by the Ghana National Chamber of Commerce and Industry (GNCCI) with support from BUSAC Fund.
The criteria for the methodology included a minimum of three years reporting of financials, evidence of business operations, business nationality; satisfactory information for valuation, and industry type.
The report recommended that SMEs should be furnished with a more proactive policy environment and be encouraged to re-invest with cheaper capital for faster growth and expansion.
This, the report said, required that enterprises created more value by adopting more innovative ways to seal off operational leakages, manage and mitigate risk exposures to balance sheet leverage, industry and product cycles, as well as weaknesses in business models.
The report recommended that Government, together with local and international partners, worked together to ensure that the growth-potential of SMEs were nurtured and transitioned into value-driven ones to ensure sustainability.
On the findings, Mr Boateng said the overall analysis suggested that the business growth of enterprises was relatively less stable and more sensitive to economic cycles.
It also revealed that most of the growth-resilient industries were in the manufacturing sector, followed by professional services, and education.
A speech read on behalf of Mr Robert Ahomka-Lindsey, the Deputy Minister of Trade and Industry lauded the strategic direction pursued by the Chamber in business data analytics, to provide targeted business-support services to its members in addressing the “lack of data” issue faced by the country.
He said the economy could not thrive without a healthy and resilient private sector, stressing that when the private sector flourished, it boosted job creation and generated wealth that could be spent and reinvested locally.
“As a government that cares about the socio -economic well-being of its citizens, we are actively engaged in supporting the private sector through creating an enabling environment for trade and investment”, the Deputy Minister, said.
He said the Ministry had aggressively pursued programmes and policies to improve the competitive edge of local industries, which yielded positive results and positive investors’ response.
Some of the programmes and policies, the Deputy Minister said, included industrial revitalization programme, One District One Factory, and the development of strategic anchor industries towards creating new growth paths.
Mr Clement Osei Amoako, President of GNCCI stated that an evidence-based advocacy approach would equip the Chamber with business and industry insights to shape government’s policies and programmes as well as multilateral support in ensuring a conducive business climate.