Chartered Economist, Emmanuel Amoah-Darkwah, has called for the provision of patient capital for startups “if we want them to grow and not collapse within a few years.”
According to him, the absence of patient capital in the Ghanaian system contributes to the collapse of startups within 5 to 10 years.
“You see, we don’t have a lot of patient capital in the system and that is why we have businesses unable to grow beyond 10 years. But if we have patient capital, whereby a startup is given credit and has about 5- or 10-years grace period, then these startups will be able to shore up their businesses,” he told Samuel Eshun on e.tv Ghana’s Fact Sheet show.
The economist believes startups must be given the opportunity and provided with patient funds once they are able to show “they’ve been existing in the space for about 2 years and present books to demonstrate the viability of their businesses.
“We need to give patient capital to businesses which will be over 5 years so they can grow steadily. But with our current rate of debt, we are unable to support smaller business grow steadily,” he lamented.
Sharing his thoughts on which categories of businesses deserve support from the newly inaugurated Development Bank of Ghana, Emmanuel Amoah-Darkwah stated, “existing businesses will want to scale up with some moving from trading to manufacturing, but if a startup demonstrates their capability of doing business, we shouldn’t shudder giving them credit.
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.
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