EDIF Board asked to promote spatial distribution

Accra, Nov. 11, GNA - Trade and Industry Minister, Mr Alan Kyeremanten on Tuesday asked the Board of Export Development and Investment Fund (EDIF) to promote spatial distribution of the benefits of the scheme to minimise the over concentration of EDIF sponsored projects in only few Regions of the country.

They should also ensure that start-up companies, which have no track record and lacked the collateral, were assisted to access the loans to engender the necessary growth in their operations. The regional distribution of projects beneficiaries under EDIF so far indicates that disbursement is skewed in favour of the Greater Accra Region.

Out of a total loan of 181 billion cedis granted beneficiaries as at the end of October 2003 the Greater Accra Region alone accounted for 102.5 billion cedis, representing 56.65 per cent of the total loan. The next ranked regions are Ashanti and Central Regions with projects accounting for 19 per cent and 12 per cent, respectively, of the total disbursement.

The Volta and Upper West Regions had no projects at all. Mr Kyeremanten said lack of finance was a major problem hindering industrial operators from diversifying and expanding their operations. He said exporters also needed capital to enable them to overcome supply side constraints to be able to meet export orders and be competitive in price, quantity and delivery.

The Minister commended the Board for their achievement since the Fund began operations in July 2001.

The Fund has under its credit facility provided loan support for export and export-related activities to the tune of 181 billion cedis to 77 companies.

Mr Kyeremanten asked the Board to explore the possibility of introducing venture capital into the EDIF portfolio as well as identify other sources of capitalising EDIF.

Mr Timothy Obeng, Chief Executive of EDIF, deplored the excessive charges being collected by some banks on the EDIF facilities and appealed to these Designated Financial Institutions (DFIs) to be moderate in their charges.

He commended the Ministry of Finance and Economic Planning for crediting it with 30 billion cedis in divestiture proceeds.

The main source of Funding for EDIF is 0.5 per cent of import levy, 10 per cent of Divestiture proceeds and grants.

An Act of Parliament established EDIF in October 2000 to make available financial resources for development and promotion of Ghana's export trade. It became operational in March 2001.