Ghana’s ability to take advantage of the Africa Continental Free Trade
Area (AfCFTA) has been dealt a major blow after a baseline study found that
only 5 percent of the country’s Micro, Small and Medium Enterprises (MSMEs)
export their products.
This was after surveying 84,592 MSMEs in 245 out 261 districts in Ghana’s 16
administrative regions with most of the surveyed firms from the Ashanti
(23,123, equivalent to 27.3 percent and Greater Accra (18,856, representing
22.3 percent) respectively.
The survey found that only 4,177 MSMEs from the 84,592 – representing a paltry
5 percent of the enterprises – export their products and/or services.
According to the survey- which was sanctioned by the Ghana Enterprises Agency
(GEA) under the GEA-Mastercard Foundation’s Young Africa Works Project and conducted
by Palladium Group Ghana Limited – of the significant proportion of the MSMEs
in all the 16 regions, 86 percent are operating in the informal sector; with
the Western North Region recording the least.
The study further found that a significant majority (87 percent) of the
enterprises are micro-sized. Again, the majority of micro- (33 percent), small
(35 percent) and medium-sized (24 percent) enterprises operate within the
handicraft sector; while majority of large firms are in the agro-processing,
textiles and garments sectors.
The baseline study of the Ghanaian MSME landscape indicates that Ghana’s MSME
sector shows very minimal growth spurts – as firms start at a particular size
and remain so throughout their lifetime, indicating that not much changes over
time, Professor Ebo Turkson, an economist at the University of Ghana, explained
this when he presented the findings.
“These findings generally suggest that although Ghana has a very vibrant MSME
sector, a large majority are micro-sized – not innovative, highly informal,
constrained by access to credit and do not grow in higher size thresholds. If
policy can enhance the productivity of MSMEs through innovative activities, it
will encourage their participation in the export markets and partly address the
issue of access to credit,” he stated.
Chief Executive Officer (CEO) of the GEA, Kosi Yankey-Ayeh, welcomed the
survey’s findings, saying in an interview with the Business and Financial Times
(B&FT) that the baseline study has given the agency a better picture of the
country’s MSME sector; and that will lead to the creation of bespoke
interventions which ensure rapid scale-up with a focus on heightening
exportation into other markets.
“It shows potential, it shows opportunity; and this is a great time for us to
enhance more people to export…build their capacity to export and take advantage
of the continental free trade area,” she stated.
Source:
B&FT