Ghana: World Bank Supports Micro, Small And Medium Enterprises (msme) Development

Friday, January 6, 2006

The World Bank Board of Directors today approved a credit[1] of US$45 million to support the implementation of Ghana’s MSME Project which forms part of a broader poverty reduction and private sector development strategies of the country.

Most businesses in Ghana fall within the category of Micro, Small and Medium Enterprises, and with an employment capacity of close to 70% of the Ghanaian labor force. They range from farming activities, agri-businesses, light manufacturing, art and craft, textiles and garments, tourism, financial services, construction business, carpentry, just to mention a few. But due to lack of adequate attention and support, the growth of these MSMEs has suffered a great deal over the past decades, resulting in the shifting of focus from entrepreneurship to a proliferation of petty trading nationwide.

The Project, therefore, aims to invigorate entrepreneurial activities at all levels, thereby promoting growth, employment generation and reducing poverty levels. It also seeks to build an integrated market access and trade facilitation infrastructure while proactively inculcating competitiveness among enterprises.

The project is also expected to develop and strengthen, on a sustainable basis, the capacity of local intermediaries to deliver financial and non-financial services to MSMEs and ensure that MSMEs make productive use of these services.

The World Bank’s Country Director for Ghana, Mats Karlsson, said: “Growth and employment in Ghana are directly linked to the growth of MSMEs. I hope that with this Project, Ghanaian banks will be more able to link up to Ghanaian businesses for more investment and private sector jobs. For the World Bank Group, this is the future.”

The Project comprises of three mutually reinforcing components:

Access to Finance- significantly improving small and micro enterprises access to finance, thereby fostering their growth, competitiveness and employment creation.

Access to Markets, Trade Facilitation and Entrepreneurship Development – help reduce operational, technical and regulatory barriers to markets. Project support will focus on the development of a market of non-financial services to MSMEs through building sustainable delivery capacities for local service providers and other private sector and trade development support structures.

Business Environment – supporting the National Medium-Term Private Sector Development Strategy in collaboration with other development partners to ensure the implementation of the program in holistic and effective way.

For more information on the World Bank’s work in sub-Saharan Africa visit:

For more information about World Bank’s activities in Ghana please click here

[1] The credit is provided on standard International Development Association (IDA) terms, with a commitment fee of 0.35 percent, a service charge of 0.75 percent over a 40 year period of maturity which includes a 10-year grace period.

Source: World Bank (Washington, DC), Press Release (link opens in a new window)