Rate of business failure unacceptable – Awal

The rate at which businesses fail in the country is unacceptable – and can be solved only if industry and academia can collaborate more effectively to churn out graduates with the right mix of entrepreneurship skills, Business Development Minister Ibrahim Awal Mohammed has said.

“The rate of business failure in Ghana is not acceptable, only 15 percent of businesses go beyond three to five years in this country. This is unacceptable,” a visibly concerned Awal lamented while launching the second edition of the Ghana Business Development Review by the University of Ghana Business School (UGBS) in Accra.

He added: “For Ghana to go beyond aid, we must reverse to make sure that at least 60-70 percent of businesses go beyond 10 years; that is when they can expand and can employ. Academia, let us see how we can make Ghanaian businesses survive and succeed.

“I want to throw a challenge to academia; we have to produce graduates with the mind-set of having an ‘I can’ attitude. I want a collaboration between academia, industry and government to produce positive mind-sets; young people who will come out of school and say ‘I can do it’, and not want to depend on government for everything…it doesn’t help.”

It is estimated that about 75 percent of businesses in Ghana fail within the first three years, while those that survive the first three years do not go beyond 10 years – with academia often being blamed for not giving students the right training.

He said it is only when the right link between academia and industry is established that government’s vision to promote home-grown industries can be set in motion.

He also reiterated that government will continue providing the enabling environment and incentives needed to ensure young people start business and succeed.

Mr. Awal, whose ministry is in charge of government business and entrepreneurial interventions for the private sector, also described as disturbing the rate at which increases in the number of universities in the country is not being matched by an increase in employable graduates.

“We have about 50 universities around the country, but the more universities we get the more unemployed graduates we have; what an irony!” he observed.

He therefore urged all universities and academic institutions to consciously redefine their curricula to make sure that what they teach is relevant to the needs of young people and of the country.

“I want to challenge academia to support and partner relevant industries to make our youth relevant in the future. We need people who are very entrepreneurial, people who can come out of school with business ideas.

“Academia must also give us the research, evidence-based information that is crucial to making decisions,” he indicated.

He also disclosed that his ministry in the coming weeks will offer funding support of between GH¢10,000 and GH¢100,000 per person, along with mentors and training, to 100 young people to implement their business ideas.

Ghana Business Development Review

Published by UGBS, the second edition of the Ghana Business Development Review (GBDR) covers key issues such as developments, performance, management and governance in 18 major sectors of the economy, as well as major constraints covering the period 2015 – 2017.

The GBDR, which builds on the first edition launched in 2016, aims to among other things, review important developments in the various business sectors, evaluate the performance of businesses across various sectors and discuss key management issues.

It also seeks to identify major challenges confronting the development of businesses and provide an outlook in terms of business growth and development in the country.

Some of the sectors captured in the second edition include: energy; tourism and hospitality; agriculture; manufacturing; oil and gas; banking; health business; and the Ghanaian economy and business environment, among others.