€22m facility for private sector

The Italian government has approved additional financial facility of €22 million to support the private sector under the Ghana Private Sector Development Facility (GPSDF).

The main component of the project is a soft loan for entrepreneurs amounting to €20million, while the remaining €2 million would be used to manage the credit facility and implement additional activities such as capacity building courses, micro-projects and development of industrial clusters in various parts of the country.

This followed the successful implementation of the first phase which was signed between the two governments from 2004 to 2008 amounting to €11million.

The €11 grant was additional financial resources approved by the Italian Ministry of Foreign Affairs in 2008 to continue to support the efforts of the government in promoting the private sector development.

The programme which has been highly welcomed by both private companies and financial institutions has assisted 29 private companies and expects over 500 applications beginning 2012.

Dr. Joseph Annan, the Deputy Minister of Trade and Industry, signing on behalf of government in Accra said: “Government had a firm belief that the private sector holds the key to the economic growth and development of the country.

“Government was also convinced that the potential of Small and Medium Scale Enterprises (SMEs) to stimulate such growth was huge as currently contribute over 80% of the country’s Gross Domestic Product (GDP).”

He indicated that the realization of the full potential of this sector is hampered by significant challenges relating to the acquisition and application of appropriate technology, access to finance, logistics management, human resources capacity building, distribution and marketing.

Tullio Guma, the Italian Ambassador to Ghana, explained that the basis for Italy’s economic development had mainly consisted of a high number of SME’s which had, over the years, demonstrated their inherent efficiency and flexibility.

“Our expectations are therefore that the Ghana Private Sector Development Facility will replicate such a development model in Ghana, especially in view of the challenges of the international financial crisis and the liberalisation of the markets in the framework of the WTO agreements.

“The GSPDF was characterized by a strong element of ownership and partnership to bring about an increased responsibility of the Ghanaian institutions and that the Italian government has continuously supported the Ghanaian economy to the tune of 19.8 million euros from Italian grants,” he remarked.