The Government of Italy has provided a 22 million Euro facility to support Small and Medium-scale Enterprises (SMEs) under the Ghana Private Sector Development Project (GSPDP).
11 million Euros was disbursed to 29 enterprises between 2004 and 2008.
At a media interaction to announce the second phase of GSPDP, Tullio Guma, Italian Ambassador to Ghana, said the second approval is as result of the successful implementation of the first facility.
Out of the total amount, he said two million would be used for capacity building activities, encouragement of decentralized corporation by local authorities through technical assistance and other initiatives from Italy.
He said the basis of Italy’s economic development resulted in a high number of Small and Medium Enterprises (SMEs) which over the years had been able to cope with the rapid changing business environment and globalization
“Our expectations are that the Ghana Private sector development facility will replicate to some extent such a development model, especially in view of the challenges of the international financial crisis and liberalization of the market in line with the World Trade Organisation agreement.”
He observed that the GSPDP was characterized by a strong element of ownership and partnership to bring about an increased responsibility of the Ghanaian institutions.
“I am convinced that this programme can ultimately give a small but significant contribution to the efforts of Ghana on its way to reach the Millennium development Goal,”
Joseph Annan, Deputy Minister of Trade and Industry, said government is convinced of the potential of Small and Medium-scale Enterprises (SMEs) to stimulate economic growth as it presently contributes over eighty percent of the country’s Gross domestic product.
However, he noted that the potential of the private sector is hampered by significant challenges relating to access to finance, acquisition and application of appropriative technology, logistics management, human resources capacity building, distribution and marketing.
He appealed to the beneficiaries of the credit facility to adhere to the repayment schedule and work closely with the team of experts managing the funds “in order to make it a successful initiative.
Already, managers of the facility have received over 450 applications from private and financial institutions with 95 companies receiving the green light while 50 are on the waiting list.
They stand to gain loans of between nine and 12 per cent interest rate per anum to be repaid over five to eight years with a grace period of two years.
Eligible companies should have full ownership of their enterprise, operate without military activities, tobacco processing and luxury goods as well as make sure their production activities did not pollute the environment.
Source: Emelia Ennin Abbey
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