The Finance Minister of Ghana, Dr. Mohammed Amin Adam, has signed a strategic Memorandum of Understanding (MOU) with the ECOWAS Bank for Investment and Development (EBID), aiming to empower small businesses and drive economic growth. The agreement, signed on May 10, 2024, during a working visit to Lomé, Togo, unlocks US$200 million in funding for small and medium enterprises (SMEs) through concessional lending by Ghana Exim Bank (GEXIM) and the Ghana Commercial Bank (GCB).
Dr. Amin Adam emphasised the importance of this partnership, stating, “This partnership with EBID marks a significant step towards driving sustainable economic growth and fostering resilience within our SME sector. The commitment of US$200 million underscores our dedication to empowering SMEs, creating jobs, and catalysing innovation for long-term economic prosperity.”
SMEs are essential to economies, serving as engines of innovation, economic growth, and job creation. Despite their critical role, SMEs often struggle to secure adequate financing. This new partnership aims to bridge this gap, providing much-needed financial support to Ghanaian SMEs.
Globally, SMEs represent over 90 percent of businesses and account for more than 50 percent of employment. They contribute significantly to economic vitality, making up 50 percent of the global GDP and employing 60 percent of the private sector workforce. In Ghana, there are approximately 850,000 SMEs, constituting about 90 percent of businesses and contributing to more than 80 percent of employment. SMEs in Ghana are particularly notable for their economic impact, contributing around 70 percent of the country’s GDP and 80 percent of private sector employment. Women-led SMEs play a significant role, accounting for an estimated 43 percent of all SMEs.
Despite their undeniable impact, SMEs in Ghana face a substantial credit gap, with an estimated US$2.4 billion in unmet financing needs. The concessional loans from this partnership are expected to boost growth, create jobs, and inject foreign exchange into the local economy, aligning with Ghana’s broader agenda of fostering entrepreneurship and achieving sustainable development.
Dr. George Agyekum Donkor, President and Chairman of the Board of Directors at EBID, stressed the importance of regional collaboration in driving economic development. “EBID is proud to partner with Ghana in this transformative initiative. This injection of funds will not only bolster the SME landscape but also contribute to overall economic growth and development in the region,” he said.
Key stakeholders, including Lawrence Agyinsam, CEO of Ghana Exim Bank, and Samuel Aidoo, Executive Director of Wholesale and Investment Banking at GCB Bank PLC, were present at the ceremony. They highlighted the arrangement’s potential to set a precedent for impactful collaboration within the Economic Community of West African States (ECOWAS). This partnership signals a collective commitment to fostering private sector growth, a key driver of sustainable development and shared prosperity across the region.
The US$200 million boost is expected to significantly enhance the resilience and growth potential of SMEs in Ghana, paving the way for increased innovation, job creation, and economic stability. This initiative exemplifies the strategic efforts needed to empower SMEs and drive economic growth in Ghana, underscoring the critical role of regional cooperation and targeted financial support.
