$100m Credit facility not disbursed

A $100 million credit facility the government negotiated with the African Development Bank (ADB) to support Ghanaian businesses has not been disbursed, because of the inability of the companies to source the loan as well as ensure prompt payment.

The Minister of Trade and Industry, Dr Kofi Konadu Apraku, who made this known said although some Ghanaian businesses have applied for the facility, many of them do not qualify because they are not credit worthy.

The minister was addressing the closing ceremony of the mid-year review meeting of the ministry at Elmina.

The programme was organised by the ministry for the various divisions under it and was sponsored by the Konrad Adenauer Foundation.

Dr Apraku mentioned the lack of qualified staff, operational machinery and technology as some of the reasons for the inability of the companies to secure the loans.

He explained that the government wants to make sure that loans disbursed to firms would not become bad debt, adding that “it is a credit facility that has to be paid back”. Dr Apraku, however, appealed to the banks to be sensitive to up-and-coming companies by giving them loans to help sustain their operations.

He noted that although as at today applications submitted from companies for the facility totalled more than ?260 billion, about ?74 billion under the Export Development and Industrial Fund (EDIF) has still not been disbursed. Dr Apraku noted that it is important that these enterprises are brought up and helped to expand to help create jobs and enhance the growth of the economy.

He said the banks, which are solely responsible for the recovery of the loans under the fund have failed to disburse the loans to small enterprises whose credibility has not been well established.

On non-traditional export, Dr Apraku said the Ghana Export Promotion Council, has supported 5,000 farmers to venture into soyabeans and are expected to produce 8,000 tonnes of the crop for export.

He noted that other export crop that would be given attention are pepper, ginger, mango and tomatoes and advised people to venture into such areas.

On small scale enterprises, the minister said the National Board for Small Scale Industries (NBSSI) has disbursed a total of ?3 billion to farmers in the form of inputs and loans to help them expand their farms.

Dr Apraku said $1 million has been set aside under the HIPC benefits to support 20 aspiring young entrepreneurs to expand their businesses.