GUTA asks government to maintain the 600 million cedis fund after Covid-19 subsides

GUTA asks government to maintain the 600 million cedis fund after Covid-19 subsides

President of GUTA, Dr Joseph Obeng

 

The President of the Ghana Union of Traders Association (GUTA) has called on government to sustain the 600 million cedis set aside to help Small and Medium Scale Enterprises (SMEs) to mend the impact of Covid-19.

According to Dr Joseph Obeng, he anticipates that the fund will be available in perpetuity to small businesses even after the first portion is paid out. 

 

“I’m expecting that this thing should be a revolving fund and that if we are able to redeem the first tranche and if government get extra funds it will also go a long a way to help us,” he said in an interview.  

 

A revolving fund is a fund or account that remains available to finance an organization's continuing operations without any fiscal year limitation. This is because the fund is replenished by repaying money used from the account. Revolving funds are not limited to the private sector. They are used to support both government and non-profit operations.

Dr Obeng, however, lauded the government for thinking about the welfare of SMEs regardless of all the other challenges that have surfaced as a result of the pandemic.

 

“You can see that government really did a wonderful work by creating this fund because the revenue is not improving because of the situation we find ourselves in. For government to be doing this and that, to be giving a whole lot of concessions in electricity, water and other things. And for government to bring this fund, means government is doing all that it can.”

 

GUTA also in a statement earlier had urged its members to use the funds for its intended purpose because that, “will then encourage the Trade Associations to appeal to government for sustenance of the package as a revolving fund for the benefit and enjoyment of current and future generations.”

In that statement the association appealed to the government to add its leadership to the committee that will supervise the implementation of the fund to prevent any anomalies that may arise.

 

“With regards to the 600 million Ghana cedis earmarked for the support of SMEs, we would appeal to the government to include leadership of the trade Associations on the committee(s) that will oversee the disbursement of the fund to the rightful beneficiaries and it should be done in fair, transparent and equitable manner, devoid of partisan politics.”

 

Dr Obeng’s comments come as the timeline which President Akufo-Addo set for the disbursement of the fund approaches. On April 5, 2020, President Akufo-Addo announced that the government is set to make available, by the end of May this year, a soft loan scheme of up to six hundred million Ghana cedis for small to medium scale enterprises as a result of the economic impact of Covid-19. The loan scheme is to have a one-year moratorium and two year repayment period.

The National Board for Small Scale (NBSSI) Industries which is tasked with the implementation of this policy has made it clear that it will honour the timelines given it.

However the Chief Executive Officer of Dalex finance, Ken Thompson had questioned the capabilities of the NBSSI to implement this policy but the body’s Executive Director Ms Kosi Antwiwaa Yankey has assured that the MBSSI will deliver as expected.

Economist Peter Quartey believes that regardless of the NBSSI’s past inabilities the Board will be able to carry its current task.  

 

“The NBSSI that I know didn’t have adequate capacity but I believe with this new assignment they are going to beef up their capacities and ensure that they effectively administer this loan.”