Former president of the Association of Ghana Industries (AGI), Dr. James Asare Adjei has been advising government on how to disburse the 600 million cedis soft loan to businesses for enhanced benefit.
Though he commended government for the gesture, he was unsure of the impact if proper assessment is not done before timely disbursement of the fund is made.
“The process of even disbursing this fund must be transparent, must be strict, and it should go to address specific needs of industries,” Dr. Asare Adjie told Abena Tabi on TV3’s news analysis show, The Key Points on Saturday.
“If you look at the scale of this pandemic and effect on manufacturing, I don’t think 600 million would be adequate to really support businesses to bounce back”, he said, indicating why government should be strategic in the disbursement.
President Akufo-Addo on Friday, in his May Day address, announced that the government in collaboration with the National Board for Small Scale Industries (NBSSI), Business & Trade Associations and selected Commercial and Rural Banks, will from May, roll out a soft loan scheme up to a total of GH¢600 million to support micro, small and medium scale businesses.
Loans disbursed will have a one-year moratorium, and two-year repayment period, he said.
This stimulus package has become necessary following the outbreak of the deadly coronavirus that has brought businesses on their kneels globally.
Dr. Asare Adjei advocated that a substantial amount of the 600 million and other stimulus package announced by government should go to the manufacturing sector.
He also cautioned against disbursing small amount in the range of 20,000 to 1000,000 to businesses that need millions to operate.
For instance, he noted, “if you have a 10 million dollar business and you are given 100,000 Ghana cedis, I mean it is virtually nothing”.
The former AGI president explained, “We are talking about some solutions that will turn around businesses so that the hundreds or thousands of workers that are going to lose their jobs, within a short period, if not all, majority of them probably coming back to work.”
He noted that often times, government initiate good ideas but their operationalization become problematic.
“We need to do real assessment to identify to what extent or what support in terms of funding quantum that such businesses need so they can turn around,” he suggested.
He also urged government to fast track the disbursement process to avoid the situation where “businesses are allowed to die” before support comes onboard.
He noted that the Association of Ghana Industries has documented and sent proposal to government in terms of arrangement or modalities to be used in supporting businesses, but it has not received any response as of May 2.
By Isaac Essel | 3news.com | Ghana