Business News of 2013-12-18

AGI hails EDAIF Act

The Association of Ghana Industries (AGI) has called on members of the association to take full advantage of the passage of the new Export Trade, Agricultural and Industrial Development Fund Act to enable them to transform their businesses.

The act, passed last week, is expected to provide financial resources for the development and promotion of export trade, facilitate agro-processing and industrial development.

“We do not have to wait for the benefits to come to us; we also do not have to go with empty hands in search of some of the funds,” the President of the association, Nana Owusu Afari, said in an interview with the Daily Graphic.

He said members would have to prepare their proposals and business plans that were specific, measurable, achievable, realistic and time-bound (SMART) to be able to pass the test as far as the requirement to access the fund was concerned.

“It affords us the opportunity not to do exports only but also to boost local production, particularly for the companies which are into agro-processing,” he said.

Significance of fund

One of the major challenges that have impeded the growth of the private sector for many years has been the issue about access to and the cost of credit.

Presently, interest rates charged an average of 30 per cent. Apart from that, the banks are not willing to lend long term, a situation which has compelled many private-sector players to borrow short term for long term projects.

In the end, they tend to be working for the banks, while they are unable to expand their businesses enough to create job avenues for the people.

The fund will, therefore, boost the efforts of the private sector because it will make available ready access to credit at far lower costs than what pertains on the market today.

It is also expected to further establish synergies with specialised institutions such as the Exim Guarantee Company, the Export Finance Company and the Venture Capital Trust to achieve its purpose and also have a presence in the regions through the regional offices and agencies of the Ministry of Trade and Industry.’

Contribution of AGI

Nana Owusu Afari lauded the sector minister for ensuring that members of the industry were part of the drafting of the bill, saying, “it afforded us the opportunity to make significant input into the bill and we are happy that it has been passed with what we asked for.”

He said the new law was such that, it would help in transforming the small and medium scale enterprises because the AGI ensured that funds to be allocated to the players in the sector were favourable.

Implementation

The AGI president said the association would closely monitor the disbursement of the funds to members to ensure that what had been specified in the bill was implemented.

“We are happy to have a representation on the Export Development and Agricultural Investment Fund (EDAIF) Board and so we believe that tracking the implementation will be easier,” he said.

Meanwhile, the Minister of Trade and Industry, Mr Haruna Iddrisu, said the new act on EDAIF would help provide the stimulus package to transform the industrial sector of the country.

He pledged the commitment of the ministry to ensure that the implementation of the act was done to benefit all players in the private sector he described that as “engine of growth”.