President of the Ghana Union of Traders’ Association (GUTA), Dr. Joseph Obeng, fears the Development Bank Ghana (DBG) will not achieve its desired impact on the business community because of its structure.
He argued the bank was made out to be a specialized purpose fund, but turns out to be like the other commercial banks in the system.
The President of the Republic, Nana Addo Dankwa Akufo-Addo, on Tuesday, 14th June 2022, launched formally the Development Bank Ghana (DBG).
DBG is aimed at helping to spearhead the vision of a Ghana Beyond Aid, which involves positioning the private sector to take the lead in the socio-economic transformation of our country, and create quality jobs for our young people.
According to the President, the idea of setting up a Development Bank, was, indeed, announced in the 2017 Budget Statement and Economic Policy when he first assumed office. “It is one of many policy initiatives that my government has come up with to help transform the Ghanaian economy.
The overriding objective is to make long-term funding available to the private sector, and develop the ecosystem for market access, technology and innovation,” he said.
The Development Bank’s focus, the President said, is to help transform the key sectors of the economy, over some time, by supporting all institutions that are essential for SME transformation.
These sectors include manufacturing, agriculture (especially off-farm value chain activities), ICT and allied services, tourism, and the mortgage and housing market.
“I doubt the DBG will have the needed impact because of how it is being structured. I thought it was going to be a specialized purpose fund to be assessed by the needed businesses and that it would be a one purpose bank for the manufacturing industry, and traders who are migrating into manufacturing or for those of us who deal with made in Ghana goods like the Exim Bank arrangement and all that,” he shared with Samuel Eshun on e.tv Ghana’s ‘Fact Sheet Show’.
According to Dr. Obeng, he believed the DBG was going to be a structured bank, competing with mainstream banks to reduce lending rates.
“If the institution of the DBG is not going to reduce lending rates, then it is generally not going to help us. We also do not know who exactly can access the bank and that’s a problem,” he added.
He urged government to introduce policies which can reduce lending rates to help the business community. “But I don’t see the DBG in any way impacting our lending rate,” he reiterated.
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