Government has finally completed the draft of the National Local Content and Participation Policy and Bill for the country.
Information available to Goldstreet Business, from the Ministry of Trade and Industry (MOTI) indicates that the bill and policy will be essential for the efficient and effective implementation of one of the most crucial pillars of government’s 10-point agenda for industrial transformation, which is the industrial sub-contracting exchange. The impending legislation will set out Ghana’s formal strategy for ensuring local participation in various value chains of the respective industries in the national economy
Building on this impending national local content and participation legislation, government has established an industrial sub-contracting exchange, which will be critical to ensuring that SMEs develop productive capacity to feed the industrial requirements of large multinational enterprises, thus ensuring their place in the productive value chains.
A similar exchange, Subcontracting and Partnership Exchanges (SPXs), under a United Nations Industrial Development Organization (UNIDO) initiative, already serves as an information portal for matchmaking suppliers and buyers, and has been effective in dealing with short-term buying contracts on the basis of ‘requests for quotations’.
The objective of this is to help local enterprises to successfully meet the challenges of globalization with regards to product and service quality and to take advantage of the emerging opportunities that evolve from industrial subcontracting, outsourcing and supply chain opportunities.
UNIDO has adopted a new approach, which involves active engagement with the procurement and local sourcing departments of large companies, identifying and mapping requirements and generating needs analyses emanating from these procurement strategies and plans.
These are all part of a wider, holistic strategy containing various policy measures set out by government to improve the capacities and fortunes of the SMEs sector in the country.
Some of the measures include efforts to address the high lending rates, in which about GHc 2 billion, which represents two percent of the central banks’ primary reserve, is being set aside to support targeted lending to SMEs as part of the Enterprise Credit Scheme announced in the 2020 budget.
Others measures include plans by the Bank of Ghana to further explore the possibility of setting a minimum loan to deposits ratio to ensure that more deposits mobilized by banks are channeled into viable private sector projects.