Business News Tue, 1 Sep 2020

Stanbic and IFE to support SMES in the face of coronavirus

Stanbic Bank Ghana on Friday August 28, 2020, entered into an agreement with Investing for Employment (IFE), an offshoot of KFW the German Development Bank, to safeguard jobs in the SME sector in the wake of the COVID-19 pandemic.

As part of the project, a total grant of EUR 6 million will be made available for selected SMEs in that are reeling from the devastating effects of COVID-19 restrictions.

Stanbic Bank will further supplement the grant by providing additional credit relief to these SMEs through extended loan tenors. This combination of measures aims to enable the beneficiary SMEs to maintain the largest share of their employees.

It is expected that at least 40 SMEs across a wide spectrum of important economic sectors (such as education or health) will be supported through the project. In addition, the combined intervention aims to contribute to the preservation of more than 8,000 jobs at other small enterprises which are collaborating with the beneficiary SMEs, e.g. as suppliers or service providers. This adds up to more than 12, 000 jobs that are foreseen to be preserved.

Speaking during the virtual signing ceremony, Chief Executive of Stanbic Bank, Alhassan Andani said the critical role the SME sector plays in the socio-economic life of the country demands that deliberate measures are taken to protect the sector in times like this.

“The SME sector contributes over 70 per cent of the country’s GDP – what this means is that the SME sector is the backbone of the Ghanaian economy. What this also tells us is that whatever threatens the stability and sustenance of the SME sector threatens the stability of the entire Ghanaian economy. We believe that when our SME sector is supported in a way that moves them from surviving this pandemic to thriving businesses, the sector will be uniquely positioned that does not only make it the backbone of the Ghanaian economy but also take this economy to the next level”, Mr. Andani said.

Mr. Andani further noted that the aim of the facility, which is to help preserve jobs and support the SME sector, is in line with Stanbic Bank’s own interventions aimed at mitigating the impact of the COVID-19 pandemic on the sector. “Stanbic Bank has, since the advent of the COVID-19 pandemic, put in place a number of measures to ensure that Ghanaian SMEs are supported through these difficult times and this joint project fits perfectly into Stanbic Bank’s own efforts aimed at mitigating the impact of the COVID-19 pandemic. This partnership with IFE is the ideal supplement to our own efforts so far.”

On her part, the Head of Cooperation at the Embassy of the Federal Republic of Germany, Mrs. Dorothee Dinkelaker said “Germany and Ghana maintain close and trustful relations. Ghana is a key partner for Germany in Africa, as illustrated not least by the intensive cooperation under the G20 Compact with Africa through the Reform and Investment Partnership.”

She added that “in light of the massive socio-economic impact of the Covid-19 pandemic both on a global and domestic level in Ghana, quick and substantive measures are necessary to help preserve employment, production capacities and supply chain linkages. KfW IFE’s Corona Response Programme forms part of the Special Initiative on Training and Employment under which the German Federal Ministry for Economic Cooperation and Development (BMZ) offers a package of measures to support investment activities that have a high impact on employment in selected countries of Africa, including Ghana. With the joint support, not only SMEs and their employees, but also their families who are maneuvering through these challenging times will benefit from this intervention.”
Source: James Dadzie, Contributor
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