The Africa Informer organized
2nd West Africa SME
Conference and International Awards of Excellence held on the 26th
of May 2016 at the prestigious British Council Auditorium in Accra Ghana. With
the theme : Reinventing SME Financing for
better impact, improved and sustainable growth, the event lived up to its
billing.
The two in one event, kicked off
with the conference in the morning and the luncheon and awards presentation in
the afternoon.
The keynote speaker His
Excellency Dr. John Jerry Rawlings was unavoidably absent due to some
international commitments, however some of the speakers like Prof. Godfred
Bokpin, HOD Finance department, University of Ghana Business School and Mr.
Arnold Boateng, Author and SME Consultant, were present. Other panelists were
Mrs. Eunice Ocansey, who delivered a paper on behalf of the Managing Director
of the Nigeria Police Mortgage Bank, Mr. Bola Adeboye; and Mrs. Sikeade Adetu,
CEO Sparrow Décor Plus as well as Jasmine Amoh, Ghanaian – Canadian TV presenter.
In his welcome speech to declare
the conference open the Publisher and Editor in Chief of Africa Informer
magazine and event host, Prince Ike Onwuka – Smarty noted that
Prince Ike Onwuka- Smarty delivering the welcome address
“Though we must commend the
continued innovation that is noticeable in the financial packages for SMEs at
the moment. Like the micro insurance concept, which has benefited small
businesses in time of disaster, the micro investment banking initiative that
allows you to invest as little as Ghc100 for interest yielding packages as well
as the various micro financing and savings and loans products that continue to
evolve. Many of these were not on the horizon a few years back. These
innovations have contributed significantly, as we strive to stabilize the SME
sector. We also appreciate the SMEs that have remained above board through
creative ingenuity over the years, some without even seeking institutional
finance”
Mr. Arnold Boateng in his paper
titled - SMEs GROWTH AND SURVIVAL IN THE
SUB-SAHARAN AFRICA: Has The Current Financing Strategies Enhanced Or Subdued
This Critical Sector Of The Economy. reiterated that ;
“Small and medium-sized enterprises (SMEs) are
productive drivers of economic growth and development for African countries.
They make up 91 percent of formalized businesses. They also contribute to
between 52 and 57 percent to GDP and providing about 61 percent to employment
in South Africa and 70 percent of the manufacturing sector in Nigeria. “SMEs
not only contribute significantly to the economy but can also serve as an
impetus for economic diversification through their development of new and
unsaturated 
In many African countries SMEs
account for about 50% of job creation. In Tanzania for example, it is estimated
that more than a third of the GDP originates from the SME sector.
A study conducted by the
University of Ghana in the past estimates that small enterprises in Ghana provide
about 85 percent of manufacturing employment and also further states that SMEs
are believed to contribute about 70 percent to Ghana's GDP and account for
about 92 percent of businesses in Ghana”
While Mr. Bola Adeboye, MD
Nigeria Police Mortgage Bank, in his address read on his behalf by Mrs. Eunice
Ocansey, titled PROPER SME FINANCING: THE CATALYST TO AFRICA'S ECONOMIC
TURNAROUND AND GROWTH, averred that
“WAY OUT OF SME CHALLENGES- I
think, there has to be a double approach to solve these problems. Government
has its own responsibilities of what is expected to be done by them, but what
we are only focusing on is the role the private sector can play in helping to
develop the economy. From my observation, in Asian countries, like Taiwan, the
government actually tailored their taxation policy to one type of tax to SMEs.
Once you are earning less than a certain amount as income there is only one tax
you will pay. They make taxation process simpler for SMEs and they were able to
take money from the informal sector to the formal sector. And that is a good
development, because that is what allowed SMEs to access money from the banks. “
Eunice Ocansey delivering paper on behalf of Mr. Bola Adeboye , MD Nigeria Police MB
Continuing, he said that “ In
addition from borrowing leaves from the Asian Tigers approach, governments have
to focus on developing our infrastructures; we must have power 24 hours a day,
we must have access to water and there must be good roads. Financing is as
important to the survival of SME as the fluid is to the human body, businesses
must be properly and adequately financed to West Africa and Africa at large to
minimize over dependence on government for livelihood. Right now, the future is
gloomy, because of the global financial meltdown. But we would all continue to
make efforts and focus on the development of the SMEs, we have a brighter
future in Africa. “
The discussions segment of the
conference turned out quite interesting and enlightening. While the host and
coordinator of the conference Ike Smarty faulted the high percentages of 60%
and above for loans from micro finance institutions as one of the biggest
problems of the productive sector of SMEs, Mr. Sebastian of Nationwide
Microfinance in defence of the institutions categorical laid the fault at the
going rate of funds in the Ghanaian, West African and African financial markets.
He also mentioned cost of inflation and other operating costs. A colleague from
Glory Capital Investments institution while corroborating him also sighted the
fact that even government bonds are at 18% in Ghana and a number of other
African countries.
Mrs. Sikeade Adetu, delivering her lecture at the conference.
However, Ike Smarty urged the
financial institutions to look beyond Africa for cheaper funds, especially in
Europe, America and even parts of Asia where funds can be assessed at 3% or
below per annum. He adviced that innovation should be employed in the sourcing
of funds instead of sticking to over flogged avenues. He adviced the setting up
of small marketing representative offices abroad with the sole aim of sourcing
for funds in these countries. His view was supported by Jasmine, who worked in
Canada a few years back in a mortgage bank and insists that she has a number of Ghanaians in Canada who are willing to invest back here considering that they
can only get 1.5% on their funds in Canada compared to at least 10% here in
Africa.
Mr. Edward Asadu, the Germany
trained CEO of Asadu Seed and Waste Management Company, one Ghana’s oldest and
efficient waste management companies, was very bitter about the astronomical
interest rates charged by banks that he referred to them as “little robbers”, drawing a lot of laughter and indignation simultaneously. He too suggested Germany as a veritable and fertile ground for private funds coming into the financial markets in Ghana and Wets Africa.
Edward Asadu, CEO Asadu Waste Management Accra
On her part Mrs. Francisca
Karikari, the CEO of Glory Capital, asked her colleagues in the financial
sector to be very prudent in their expenditure as this is one of the reasons
for a lot of capital flight. She frowned at the practice of irrelevant
expenditure like unnecessary cars, gigantic edifices and other unnecessary spending
that affect the growth of the business.
Mrs Francisca Karikari, CEO GloryGate Capital Accra Ghana
Declaring the conference closed,
Prince Ike Smarty recognized the innovation of the likes of Star
Microinsurance, which has been insuring small businesses like traders,
fishermen etc, and even the loans given to them by the micro financiers. These
are sectors that have been neglected by the insurance industry for decades. In
the same vein, he commended Glory Capital for bringing another dimension to
investment banking, through its micro investment plans, where SME operators can
invest as little as Ghc 100 for yields as high as 18% in 30 days. This was an
area that was reserved for mainly investors who have millions to spare.
He also urged financial institutions
that are specifically set up to fund the SME sector across West Africa and
Africa, like micro finance banks, savings and loans institutions etc, to go
seek cheaper funds in order for interest rates to be minimized as one antidote
to the high mortality rate of MSMEs across the continent.
