Capital market can address problem of long-term financing for critical sectors

By Belinda Ayamgha, GNA

Accra, Nov. 21, GNA - Yaw Osafo-Maafo, Senior Minister, says Ghana’s capital markets must address the problem of absence of long-term financing for critical sectors of the economy such as agriculture and mortgage financing.

He said the absence of reliable long-term financing for critical sectors has been the bane of Ghana’s economy and must be addressed.

He was speaking at the opening of the 3rd Capital Markets Conference and Exhibition organized by the Securities and Exchange Commission (SEC) in commemoration of the 20th anniversary of the SEC held under the theme: “Ghana Beyond Aid-The role of the Capital Market”.

He said the mortgage and agricultural sectors in particular, have had serious difficulties with financing in the country, particularly for areas like tree crops agriculture.

“People see the need for these but we just don’t have the organized long-term fund available,” he said, adding that the 2019 budget had outlined some interventions for mortgage financing.

He said the availability of pension funds must give meaning to mortgage financing in Ghana’s economy.

“Achieving Ghana beyond Aid must be underpinned by a sound and robust financial system because financial markets facilitate mobilization, intermediation, long term funds for strategic investments,” he said, adding that robust and functioning capital markets were the secret behind the success of many industrialised nations.

He commended the choice of theme for the conference, saying it was apt, in light of the Ghana beyond Aid agenda of government and urged the SEC to ensure that its next phase is tied into this agenda, which aims as making Ghana a transformed and prosperous country which was beyond needing aid and possibly supporting other African countries.

He also commended the SEC for its work over the past 20 years, noting that it had acted decisively in recent times to prevent a major crisis in the investment space and prevented several individuals from investment in dubious avenues.

Dr Yeboa Amoa, Chairman of the Board of the SEC, said the conference has brought together investment banking practitioners, policy makers, academia and the public to deliberate on how best to develop and deepen the long-term financial market over the two-day period, as well as to take stock of the past and future performance of the Commission.

He said Ghana could use the capital market to industrialise, finance the huge infrastructure gap, create wealth, inject efficiencies into the private sector and SOEs and also turn ideas into marketable products.

This, however, required a robust local capital market, which could not be done without total government commitment and support, especially by divesting SOEs through the stock exchange and also providing incentives to the private sector enterprises listed on the Stock Exchange.

“…we therefore urge this government to make a three hundred and sixty degree turn in its policy commitment to Ghana’s capital market development,” he said.

Ms Mary Uduk, Acting Director General of the Securities and Stock Exchange of Nigeria, congratulated the SEC for the significant achievements it had chalked over the 20 years, saying Ghana has developed its local capital market whiles ensuring the full integration and growth of the West African capital market.

“We believe the capital market can and should play a significant role in funding critical sectors of every economy and the sustainable development of every African nation,” she said.

GNA

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