Vibrant Capital Market To Unleash Creative Potentials

Mona Quartey PixA vibrant capital market in the country will help close the infrastructure gap, create wealth and unleash the creative potential of the people, Mrs Mona Quartey, Deputy Minister of Finance, has noted.

She said such a vibrant capital market would also inject efficiencies in the operation of public utilities and enterprises, and turn ideas into marketable products of global dimensions.

“The capital market as part of the financial system is therefore, critical for our economic development process,” Mrs Quartey said.

She made the observation in Accra at the weekend, when Izwe Loan Limited, a subsidiary of the Izwe Africa Group of Companies, was listed on the Ghana Stock Exchange (GSE) with GH¢80 million Medium Term Note.

She said the small and medium enterprises (SMEs) sector continued to play a vital role as a tool for economic empowerment of the poor.

Mrs Quartey said in Ghana, SMEs accounted for more than 90 per cent of business enterprises and continued to contribute largely to the creation of new jobs.

The Deputy Minister said it had been estimated that SMEs provided about 85 per cent of manufacturing employment, account for more than 90 per cent of existing businesses and were the primary drivers for gross domestic product growth.

She said broadly, SMEs contributed to economic diversification, employment creation, provision of basic goods and services, and generation of export and tax revenues for the nation’s development process.

Mrs Quartey said it was gratifying to note that government’s efforts in establishing the Ghana Alternate Exchange (GAX) had begun yielding positive results, saying “the focus of the GAX on start-ups and existing enterprises with the potential for growth was a step in the right direction”.

She said, in addition, listing on the GSE also brings enormous benefits such as initial increase in company’s ability to raise funds, improve corporate governance, and the transparency in transactions of listed securities in a competitive condition.

Mrs Quartey said the capital market and the exchange remains the most appropriate source of capital and trading platform for all businesses seeking to raise long term financing at a relatively lower cost for their operations.

Mr Raymond Kwakye Bismarck, Managing Director of Izwe Loans Limited, said the company since opening its door in July 2011 has been committed to building a business underpinned by integrity, trust and responsible lending practices that the Ghanaian market and the Izwe Group were proud to call their own.

He said over the past three years, Izwe had established itself as one of the largest government payroll lenders in the country, with a loan book of GH¢90 million and currently serving more than 35,000 customers.

Mr. Kofi S. Yamoah, MD, GSE, said the listing of Izwe as the first non-banking institution on the exchange would pave the way for the listing of more non-banking financial institutions next year.

Mr. Samuel Appenteng, chairman, GAX Governing Committee, said most companies in Ghana took loans from the banks at high interest rates, which they would hardly service, stating that GAX was the best option for SMEs. — GNA

 

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