ADDRESS BY PRESIDENT AKUFO-ADDO, AT NEIP LAUNCH IN ALISA HOTEL, RIDGE, ACCRA, ON 13TH JULY, 2017
| Updated Jul 13, 2017 at 4:00pm
I am happy to be here today to launch this landmark initiative that is targeted at accelerating the process of job creation and national development.
Establishing a strong economy and generating improved living standards for our people is the most important task I have to accomplish as President. My success or failure will be judged by the capacity of the economy under my watch to provide opportunities and inspire people to start new businesses, and encourage new businesses to invest, grow and expand. In effect, jobs, jobs, jobs – that has to be my credo.
Ladies and Gentlemen
The goal of my government is to build the most business-friendly economy in Africa, and create jobs and prosperity for all Ghanaians. To achieve this, we need to establish the relevant policy framework that will help businesses to expand and create jobs, and we must promote the growth and development of entrepreneurship. And this we must do, keeping firmly in our minds, the needs of our young people in particular.
During the past 20 years, those countries that have made rapid economic strides have been the ones that have encouraged high levels of investment in entrepreneur development. The growth of a more entrepreneurial economy has led to the creation of jobs and the acceleration of economic growth.
We can learn a lot from this global trend to develop an entrepreneurial economy, and create a conducive and business-friendly environment in our country. It should not really be a difficult thing for us to do, because it might not look like it these days with everybody seeming to be looking for jobs in government, but I daresay the wealth of this nation was built on the private sector and the entrepreneurial spirit of our people. Time was when the good money was made by the private sector and the risk takers, and not by public officials. We need to get back to those times. Ghanaians are renowned for their sense of enterprise, creativity and innovation, and the moment has come to reinvigorate that culture.
In the past six months, government has set about putting in place the measures needed to reduce the cost of doing business and improve the business environment. We have begun to act on the fundamentals. We are stabilising the macroeconomy and the cedi. Inflation has gone down from 15.4% in December 2016 to 12.1% in June 2017, i.e. a period of six months, the lowest in four years. The benchmark 91-day Treasury Bill (T-bill) rate was 22.8% in January last year, and has narrowed to 11.9% in June 2017, the lowest in 5 years. We have abolished a lot of taxes such as the 1% Special Import Levy, 5% VAT on Real Estate sales, 17.5% VAT on domestic airline tickets, 17.5% VAT on financial services, 17.5% VAT on selected imported medicines that are not produced locally, and have re-introduced the 3% flat VAT rate for traders. I know that some traders are having problems with the re-introduction of the 3% flat rate, but I am confident that, as time goes by, the objectives of the policy will be better appreciated and embraced. All these measures are being undertaken to stimulate enterprise activity and growth. Very soon, we shall reap the benefits of more jobs and an expanding economy.
Ladies and Gentlemen
Small and medium-sized enterprises (SME) make up over 90% of businesses worldwide, and account for the majority of private-sector activity in both advanced and emerging market economies.
Ours is predominantly an SME economy, and the economic growth and development of our country depend on how well we nurture and support start-ups and the micro, small and medium-scale enterprises to enhance their contribution to GDP, job creation and exports.
Micro, small, and medium-scale enterprises (MSMEs) contribute about 70 percent of Ghana’s GDP, and account for more than 92 percent of enterprises. An overwhelming majority, estimated at 90% of businesses, employs less than 20 people, and there are relatively few enterprises in our country that qualify as large-scale enterprises. It is obvious, therefore, that we have to focus on the development of start-ups and small businesses by encouraging the entrepreneurial spirit as a national priority.
Ladies and Gentlemen, the greatest problem of our country is widespread unemployment and lack of jobs. Every year, more young people join in the dispiriting search for jobs. I have come face to face with the desperation that is engendered by the lack of jobs. I have spoken about it often. I have even come to accept that it is this lack of jobs that has led to the phenomenon of so many people looking to government for jobs, which appears to be dampening our traditional entrepreneurial spirit.
The fact that unemployment is a worldwide phenomenon does not make our national and personal situation any easier to endure. It does not lessen the heartbreak of parents who watch their children go through the frustration of joblessness year after dispiriting year. In 2015, some 4,500 young Ghanaians arrived in Italy, after undertaking the horrendous Mediterranean crossing that we all see on television.
I am determined that we change the economic conditions in our country for the better, to ensure that young people see it as a place of opportunities, instead of the place from which they flee at the peril of their lives. We need to do all within our power to create an entrepreneurial climate, to enable our young people come up with creative ideas that can be developed into businesses.
Let me therefore introduce you all to the National Entrepreneurship and Innovations Plan. This is the flagship initiative, which will be the primary vehicle for providing an integrated, national support for start-ups and small businesses.
The Plan will enable new businesses to emerge and give them the space to grow, to receive financing and business development services, to secure markets during the critical formative years, and to tap into a wide supply chain and network during their growth years, helping to create jobs at a widely distributed, national level.
Despite the severe constraints of our public finances, which have resulted from years of mismanagement and corruption, Government has contributed US$10 million as seed money for the Plan. It is the intention that this seed money should be leveraged to raise money from private sources and public organisations to the tune of US$100 million to fund its programmes.
Ladies and Gentlemen,
The overall objective of this Plan is to stimulate private sector growth at the early-stages of businesses, to accelerate job creation and to provide entrepreneurial Ghanaian youth with a critical alternative to salaried employment. It will help their businesses to grow and compete domestically and internationally.
The National Entrepreneurship and Innovations Plan, will, amongst others:
i. provide tax incentives for start-ups owned by young entrepreneurs;
ii. incentivise and partner private sector investors to set up business Incubator Hubs and Industrial Parks for youth-owned businesses nationally;
iii. establish a Youth Enterprise Fund which will be leveraged to attract private capital to fund start-ups;
iv. provide a ready market for the products and services of start-ups through the reservation of a percentage of the proposed 70% of local content public procurement contracts;
v. implement a Buy-Local policy for ICT services from youth-owned businesses; and
vi. set up an Industrial Sub-Contracting Exchange to link large industries with small businesses and start-ups as a supply chain for goods and services.
Ladies and Gentlemen, I am confident that this Plan will be made to work to provide young people with what it promises. Young people, who take the risk of entrepreneurship, will find that they have support through the difficult, early stages. I am passionate about the Plan working. I am investing a lot in it, and I have confidence in the Minister for Business Development, Ibrahim Awal Mohammed, who has devised the Plan, and will be in charge of seeing it to fruition.
It is, thus, now my pleasant duty to declare the National Entrepreneurship and Innovations Plan duly launched.
Thank you for your attention, and may the Almighty bless us all and our homeland Ghana, and make her great and strong.