SMEs Set To Drive Innovation

– In country’s economic transformation

Story: By Isaac AIDOO, Accra

GHANA’S Small and Medium enterprises (SMEs) are poised to play an even larger role in the country’s economic transformation, thanks to the government’s strategic interventions and international partnerships.

The second Quarterly Economic Roundtable (QER), held at the University of Ghana, Legon, saw Finance Minister Dr. Mohammed Amin Adam reaffirm the government’s commitment to fostering SME growth, themed: ‘Driving Economic Growth Through Small and Medium Enterprises (SMEs).’

In his address, Dr. Adam emphasized that SMEs are the backbone of Ghana’s economy, driving innovation, employment, and productivity. He highlighted the government’s flagship SME Growth and Opportunity Programme (SME GO), launched in July 2024 with a GH₵8.2 billion investment to tackle critical challenges hindering SME development, including limited access to finance, skills gaps, and restricted market opportunities.

“SMEs are at the core of Ghana’s economic growth strategy,” Dr. Adam remarked. “The SME-GO programme is designed to empower these businesses to capitalize on regional and global opportunities, particularly within the African Continental Free Trade Area (AfCFTA). We are creating a platform that will allow SMEs to thrive, contribute more significantly to GDP, and ultimately create more jobs for Ghanaians.”

The SME-GO programme’s strategic importance is underscored by its alignment with other government-led initiatives, including the US$200 million Ghana Jobs and Skills Project and the US$200 million Ghana Economic Transformation Project, both funded by the World Bank.

These projects, according to Dr. Adam, aim to address structural issues in the SME ecosystem by providing skills development, promoting export linkages, and creating a more conducive environment for business reforms.

Strategic Partnerships to Drive Growth

A crucial element of the SME-GO programme is its collaboration with global partners such as the African Development Bank (AfDB) and the International Finance Corporation (IFC). Dr. Adam revealed that these partnerships are vital in advancing the government’s mission to make SMEs the engine of economic growth.

 “Our strategic partnerships with AfDB and IFC are helping us strengthen our SME development pathway. Their expertise and resources are critical to unlocking the potential of our SMEs,” he stated.

Kyle Kelhofer, the Senior Country Manager for IFC, echoed these sentiments, emphasizing the importance of collaboration between academia, government, and financial institutions in developing innovative financing models that address the needs of SMEs.

“Through our collaboration, we are creating a robust ecosystem that supports SMEs in accessing the financing they need, particularly in critical sectors such as agribusiness, fintech, healthcare, and manufacturing,” he said.

Over the past decade, the IFC has invested nearly $2 billion into Ghana’s economy, with $150 million directly allocated to SMEs in the last year alone. Kelhofer highlighted how these investments are enabling SMEs to overcome financing barriers, expand into new markets, and leverage technology to drive growth.

“Our innovative platforms have enhanced SME access to trade finance, expanded supply chain financing, and provided greater support to micro-borrowers. We believe that by working closely with the government, we can replicate these successes across various sectors,” Kelhofer added.

Institutional Reforms and Capacity Building

As part of the government’s long-term vision for SMEs, Dr. Adam stressed that reforms at key institutions like the Ghana Enterprises Agency, MASLOC, and the National Entrepreneurship and Innovation Programme (NEIP) are ongoing to ensure more targeted and efficient support for SMEs.

These institutions are being equipped to deliver timely and comprehensive services, from business advisory to financial support.

Dr. Adam also underscored the importance of capacity building, particularly in bridging the skills gap for young entrepreneurs and startups. “A significant part of our SME growth strategy involves providing the right skills and training to entrepreneurs so they can innovate, compete, and scale their businesses.

“This is why we are also prioritizing projects like the Ghana Jobs and Skills Project to ensure that our workforce is prepared for the demands of a modern economy,” he stressed.

The Future of SMEs in Ghana’s Economic Growth

Looking ahead, the future for Ghanaian SMEs looks bright, especially with the anticipated passage of the Ghana Startup Bill, which Dr. Adam noted will provide a structured regulatory environment for startups to grow and thrive. “The Ghana Startup Bill will outline clear rights and responsibilities for SMEs and create a conducive space for startups to attract investment and grow sustainably,” he said.

Kyle Kelhofer echoed this optimism, stating that Ghana’s economic growth hinges on the resilience and innovation of its SMEs. “SMEs are crucial to driving Ghana’s transition towards a more sustainable and diversified economy. With the right support and financing, these businesses will lead the charge in creating jobs, fostering innovation, and boosting exports,” he added.

The minister concluded by reassuring SMEs of the government’s unwavering support. “To the SMEs that continue to strive, you are not alone. You are a priority for the government and the Ghanaian society. We are building a future with SMEs at the centre of our economic transformation, and we will not fail you,” Dr. Adam affirmed.

As discussions at the Quarterly Economic Roundtable came to a close, stakeholders from the private sector, academia, and financial institutions echoed the need for collective action to bolster SME growth. The event served as a testament to Ghana’s potential to drive economic development through its SMEs, supported by a strong policy framework, strategic partnerships, and institutional reforms.