The Ghana National Chamber of Commerce and Industry (GNCCI) has commended government’s decision to establish the National Development Bank to help provide lending support to businesses in the country.
The Chamber believed that credit facility to businesses was a bane, and that the initiative would provide financial support to small and medium enterprises to thrive.
Mr Ken Ofori-Atta, the Finance Minister presenting the 2020 Budget Statement and Economic Policy to Parliament on wednesday said a feasibility study for the establishment of the National Development Bank (NDB) was completed.
The study specifies the rationale, mandate, business model, legal and regulatory framework, ownership, governance and sustainability of the Bank.
Government is working with the World Bank and other development partners to capitalize the bank in 2020 for it to commerce operations.
The NDB will re-finance credit to industry and agriculture as a wholesale bank; and also provide guarantee instruments to encourage universal banks to lend to the specific sectors of the economy.
Mr Mark Adu-Aboagye, the Chief Executive Officer of GNCCI in an interview with the Ghana News Agency in Accra on the budget statement said the initiative when implemented would provide long term funding for the growth and expansion of businesses, because of its independence with strong corporate governance framework.
Touching on the economic outlook, Mr Adu-Aboagye lauded the country’s macro-economic indicators, with inflation of 7.7 per cent in October 2019.
“Even though there is growth in the non-oil sector including; agriculture and the manufacturing sector, government must work on the cedi depreciation to build confidence in transacting businesses”, he added.
He urged government to take measures to consolidate the gains of the economy and work towards implementing the policies.
On taxes, the Chief Executive Officer urged government to broaden the tax network to achieve the needed revenue for developmental projects.
He expressed concern about government’s inability to meet its revenue targets over the years, and appealed to authorities to be innovative in mobilizing revenue for the country.
Focusing on road infrastructure, Mr Adu-Aboagye lauded government’s commitment to construct roads, but stated that such roads should be done in areas to facilitate the production of goods and services and not the ceremonial roads.
He lauded government’s efforts in stabilising the energy sector and called for its sustainability because businesses cannot thrive in this competitive market without continuous energy.
Speaking on one district, one factory, Mr Adu-Aboagye said even though government allocated huge sums of money on the initiative, some companies were yet to receive the money, urging government to work towards that.
On the African Continental Free Trade Area, he said that Mr Ofori-Atta could not touch more on how companies could leverage on that, since countries including; Tunisia and Egypt took advantage to capitalise on the markets.
“In all, there is some level of hope for the budget and we are looking to see how these policies will be implemented. Government must translate the macro-economic indicators to micro economy”, he added.