By Stephen Odoi-Larbi
One of the major stumbling blocks in starting businesses, as well as to ensure the growth of existing ones in the private sector, has been access to medium and long-term financing.
To ameliorate the problem, following the successful implementation of the Ghana Private Sector Development Fund (GPSDF), financed by the Italian Government in 2003 at the tune of 11,000,000 Euros, the Italian Ministry for Foreign Affairs (MAE-DGCS) approved in December 2007 additional financial resources of 22,000,000 Euros (approximately GH¢45 million), in order to continue to support the effort of the Government of the Republic of Ghana to promote private sector development.
The Chronicle has learnt that till date, the 22 million Euros dispatched to the Ministry of Trade for disbursement, has still not been disbursed, in spite of a directive issued in March 2009 by the Italian Coordinator of the GPSDF, Fabio Tabbo, for the release of the funds.
Some would-be beneficiaries could not understand the delay, and have pointed accusing fingers at the Minister for Trade and Industry, Hannah Tetteh, in what they allegedly described as her failure to disburse the credit facility released by the Italian government under the GPSDF project.
The Ministry of Trade and Industry, in March 2009, issued guidelines to Small and Medium Enterprises (SMEs) for accessing the Italian Government credit facility of 22,000,000 Euros. The facility was to be utilised through Ghanaian financial intermediaries, namely commercial banks and leasing companies.
The new phase of the project, implemented in collaboration with the Ghanaian Ministry of Trade and Industry, consists of two main components, a loan component of 20,000,000 Euro to be used to establish a credit facility in favour of Ghanaian private Small and Medium Enterprises, and a grant component of 2,000,000 Euro covering the operational costs and the technical assistance to activities of the Project.
The SMEs, whose applications were deemed eligible, according to investigations conducted by The Chronicle, were notified by the GPSDF Secretariat to contact their banks and leasing companies that had signed the Framework On-Lending Agreement with Bank of Ghana for disbursement of the facility, but to no avail.
“Since March 2010, when Fabio Tabbo, the Italian Coordinator of the facility, issued approval letters to SMEs to contact their banks and leasing companies for disbursement, not a single Small and Medium Enterprise has benefitted,” recounted the owner of a private firm, who wants his identity to be protected.
The situation, according to industry experts, was having rippling effects on the would-be SME beneficiaries that have spent huge sums of money in preparing their business plans and other relevant licenses and documentation, in order to access the facility.
They are, therefore, at Madam Hannah Tetteh’s throat for allegedly failing to appoint an external auditor to audit the accounts of the GPSDF Secretariat, before paving the way for the money to be accessed.
“SMEs which were given approval letters by the Italian Coordinator of the facility have spent so much money to meet eligibility criteria, and have waited almost one year without the slightest hope that the Minister will act to make disbursement possible,” bemoaned the Chief Executive Officer (CEO) of one of the would-be beneficiary private firms.
Efforts to get the Ministry and the GPSDF Secretariat’s response to the aforementioned allegations proved futile.
Ms. Hannah Tetteh’s handset, when called, was either switched off or out of coverage area. A follow up to the Ministry was even more frustrating, as The Chronicle was directed to talk to people who needed permission before relaying information to us.
The Public Affairs Directorate at the Ministry of Trade and Industry had little knowledge about the GPSDF, and so was directed by the Assistant Public Relations Officer, Mabel D. Awudu, to talk to Sampson Abankwa from the GSPF Secretariat.
Abankwa said he needed permission from his boss before he could comment on the issue. But, according to him, Fabio Tabbo was on leave, and he (Abankwa) did not know when he would return to work.
The Chronicle was directed to talk to the Chief Director of the Ministry of Trade and Industry on Tuesday December 14, 2010, but her Secretary, requested that he put his concerns into writing, for it to be addressed by the Chief Director as soon as possible, but nothing has been heard from her office.