Workshop for understanding venture capital/private equity opens

Elmina, April 1, GNA - An economist, Dr Samuel Nii-Noi Ashong, has said the nation's trade balance had been negative over the years because most of Ghana's industries have been built on imported inputs. He said some industries in the country have only been able to survive due to the prudent management of their resources and that exchange rates also favour importers more than exporters.

Dr Ashong, who is also the Chairman of the Venture Capital Trust Fund, said this when he opened a four-day workshop on "Understanding venture capital/private equity transactions" at Elmina. The workshop, which is being organized by the Trust Fund for operators in that sector, including investment analysts and fund managers, is among others, training the participants on investment appraisal and analysis, deal sourcing, portfolio valuation and documentation. It is geared towards building capacity for the Venture capital/Private Equity industry in Ghana to enhance its development and also improve the performance of fund managers.

It is expected that the training would enable the participants to technically assess investment opportunities and the inherent risks associated with them and be able to understand the legal implications of the industry.

Dr Ashong said over the past few years, the nation's deficit had been hovering around seven per cent of the Gross Domestic Product (GDP) because about 70 percent of her total bill on expenditure was spent on payment of wages.

He said the problem becomes compounded when during election years the budget is thrown out of gear when the incumbent governments resort to excessive spending to undertake all manner of projects to help consolidate their bid to stay in power.

He expressed the hope that with the development and growth of sectors like tourism, the trend could be revered in order to put the nation's trade balance on an even keel.

Recounting the nation's economic performance from the 1990s, and efforts to reduce the inflation rate to a single digit, Dr Ashong said constraints of increases in the price of oil on the world market and the irregular rainfall patterns, with the resultant increases in food prices posed a problem for the attainment of that goal.

He outlined the mandate of the Trust Fund, which includes providing technical assistance such as the provision of skills and expertise towards the development of Small and Medium Enterprise (SMEs). He said there was the need to create a stable environment, promote growth and support income generation and stressed the objective of the Fund to assist the government in these ventures.