E the itc competitiveness grid, used in this report, shows that enterprise performance depends not only on firm competitiveness but also on external factors linked to the immediate business environment and. Impact of fraud on ghanaian small and medium scale enterprises smes and coping mechanisms. Third, we identify the most important obstacles to sme growth in subsaharan africa. The national board for small scale industries nbssi which is the regulatory body for smes in ghana defines smes in terms of both fixed asset and number of employees. Keeping this in view and the wider recognition of the potential contribution of the sme. From evidence to action small and mediumsized enterprises are engines of growth and job creation in developing countries, particularly in ghana today. Determinants of new products innovation in ghanaian smes sector. Institutional framework for promoting small and medium scale. A major barrier to rapid development of the sme sector is a shortage of both debt and equity financing. The share of smes to the gdp in ghana went up to about 49% in 2012 nimako et al. Key issues facing sme development in ghana challenges. In ghana, inkind grants were more successful than cash grants at increasing firm profits.
Smes in ghana have been noted to provide about 85% of manufacturing employment of ghana. Measuring performance in small and medium enterprises in. Smes will often locate in the cheapest real estate available and this can project a negative image to potential customers often taking a garage or floor of a house, or locating in a crowded market area. An assessment of the inventory management practices of. The following companies did not match exactly but may also be of interest to you. Department of accountancy, tamale polytechnic, tamale 2. This study also examines different internal factors that may be responsible for the unstable and. Financing small and medium enterprises smes in ghana.
Valley view university, accra, ghana abstract this study examined the institutional framework for promoting small and mediumscale enterprises in ghana from the perspectives of smes. Small and medium enterprises smes in nigeria have not performed creditably well and hence have not played the expected vital and vibrant role in the economic growth and development of nigeria. Access to finance for smes by the world bank, ghana office this paper has been jointly produce by acet and world bank, and sponsored by the acet way. Find the list of top small business in accra, ghana on our business directory. It is in view of this that this study seeks to explore the challenges of smes in accessing debts finance in the ghanaian financial market and to. Smes are the core or basis for the future of developing countries as well as developed countries in creating jobs and competitiveness. Institute for social research and development, accra. Ifrs for smes 2009 institute of chartered accountants of ghana. Access to finance constraint and smes functioning in ghana. Mr owusuagyeman made the appeal on wednesday in accra at the third edition of the graphic business. Ijbmsr small and medium enterprise sme finance in ghana. In ghana, available data from the registrar general indicates that 90% of companies registered are micro, small and medium enterprises. Small and medium scale enterprises, sme operators, portharcourt city, nigeria.
Establishing the factors affecting the growth of small and. They compete with valueadded products and good buyerseller relationships. This situation has been of great concern to the government, citizenry, operators, practitioners and the. Selorm akaba department of agriculture extension and economics university of cape coast, ghana mr. Kessey kwame nkrumah university of science and technology, ghana abstract smes in developing countries play significant role in the economic activities of those nations. An assessment of the inventory management practices of small. They indicate that while the higher performing smes give a higher priority to marketing than to other business functions, they are still sales or productionoriented. Smes in ghana do not also have the luxury of picking a financing scheme that. Sme that are larger than micro companies, and either part of or heading towards the formal economy. Download financing small and medium enterprises smes in ghana. Ghana boosts financial support for sme development ghana. Unfortunately, smes today also face a number of barriers on their quest to growthfrom poor access to finance to low managerial. Once more, the agi 2006 looked at the dynamic position of smes in improving nations and defined it as the engines through which the development goals can be accomplished. To determine alternative sources of finance for smes in the greater accra region of ghana.
Pdf this paper discusses the characteristics, contributions of smes to economic development, and the constraints. Red tape, corruption, complex entry regulations etc. As per statistics from the united nations economic commission for africa 2010, ghanas gdp grew at an annual rate of 5. Income gni per capita is five times that of ghana, smes would be those. The study resorts to the current world bank enterprise survey data released for ghana 20. Pdf impact of fraud on ghanaian small and medium scale. Due to the nature of ghana s economy it is difficult to quantify just how important they are, but estimates suggest 70% of all gdp contributions come from such enterprises. Small and mediumsized enterprises smes are big business in ghana. Access to finance has been earmarked as one of the critical constraints to small and medium enterprises smes sector in ghana. Nov 11, 2014 the national board for small scale industries nbssi has said the small and medium enterprises smes landscape in ghana holds great potential looking at the caliber of people turning to the sector. They also make up 91 % of formalized businesses in south africa and 70 % of the manufacturing sector in nigeria. An assessment of the inventory management practices of small and medium enterprises smes in the northern region of ghana hamza kasim 1, mutala zubieru 2, stephen kwadwo antwi 3 1.
The study presented in this paper analyzes the factors influencing the growth rate of small and mediumsized enterprises smes in algeria and explores the extent to which their success or failure depends on the wider business climate. This report uses itc data on small and mediumsized enterprise sme competitiveness at macro, meso and microlevel to derisk investment decisions. They have specific strengths and weaknesses that may require special policy responses. Impact of government and other institutions support on. European journal of accounting auditing and finance research vol. Challenges of small and medium enterprises smes in accra, ghana mr. An empirical perspective of smes in the cape coast metropolis, ghana moses ahomka yeboah, cape coast polytechnic, ghana the high failure rate of small and medium enterprises smes in ghana is alarming, despite copious government policy and stimulus schemes directed at smes. All books are in clear copy here, and all files are secure so dont worry about it. The role of microfinance institutions george kwadwo anane university of energy and natural resources, sunyani ghana patrick brandful cobbinah school of environmental sciences, institute for land, water and society, charles sturt university, alburywodonga, australia. Findings confirmed the existence of formal institutions that support smes in ghana. What are the contraints to sme financing within ecowas.
The main focus of this research is to explore the nature and the characteristics of smes together with the financial constraints facing the smes. However, selective checks in cli ent files showed that chang es in dealing. Working capital management practices of small scale enterprises in the central region of ghana edward marfoyiadom department of accounting and finance, school of business, university of cape coast, cape coast ghana. This thesis is made of standalone essays on the capital structure and financing of small and. Challenges affecting sme s growth in ghana andy ohemeng asare school of management and economics, university of electronic science and technology of china, chengdu, china. Introduction small and medium scale enterprises smes are generally regarded as the engine of economic growth and equitable development in developing economies. The recent upsurge in the interest of finding ways of bridging the financing gap faced by smes by these stakeholders have been necessitated by the enormous contributions of smes to the economic development and growth of countries in areas of job creation, gdp and entrepreneurial skill development. Smes can bring about economic growth and national developments in ghana. The focus of the study is to examine the impact of government and other institutions support on the performance of small and mediumsized enterprises in agribusiness sector of ghana. Due to the nature of ghanas economy it is difficult to quantify just how important they are, but estimates suggest 70% of all gdp contributions come from such enterprises. Smes are not only the engine of the economy, but can also serve as a stimulus for economic diversification in other. Using the two stage least squares, 2sls the results show a significant relationship with capital structure and profitability which is negatively related. In the region, smes are severely hampered by a weakly developed business environment.
As in the case of europe, those enterprises which employ less than 250 employees, the socalled smes, have been the main source of employment growth within the nonfinancial sector in the european economy. Issues in sme development in ghana and south africa. Smes operators and provision of tax incentives for smes operators. Are small and medium enterprises smes planning for. The role of microfinance institutions george kwadwo anane university of energy and natural resources, sunyani ghana. Chosniel elikem ocloo department of marketing, accra polytechnic p.
At the inclusive agribusiness centre, we support startups and smes within the agricultural value chain in ghana with business development advic. Pdf nature and operations of smes in ghana gilly boateng. The enabling environment and trade and investment capacity building executive summary recent assessments of growth point to an understanding that the rate at which countries grow is substantially determined by 1 their ability to integrate with the global economy through trade and. Examining business performance of micro, small and medium. A clear definition is also essential so that entities that are not small or mediumsized entities, and therefore are not eligible to use the ifrs for smes, do not assert that they are in compliance with it see paragraph 1. E country report, the first of a series of publications assessing smes competitiveness. This study, the challenges faced by small and medium enterprises in obtaining credit in ghana, was undertaken to highlight the issues facing smes in ghana in their quest to.
For an economy to live up to expectation in the committee of nations development, such economy must achieve accelerated economic growth and development which is a prerequisite for improving quality of life. Abstract issues of finance and small and mediumsized enterprises smes in developing countries. D managing consultant sem international associates limited accra, ghana. Small and mediumsized enterprises smes account for over 95% of firms and 60%70% of employment and generate a large share of new jobs in oecd economies. The higher performing smes are more aware of strategic planning tools. Whether they deal in services or manufacturing, exporting smes show higher total revenues, faster total revenue growth, and higher labor productivity than their nonexporting sme counterparts.
Finance and development research programme working paper series paper no 15 the policy environment for promoting small and mediumsized enterprises in ghana and malawi dalitso kayanula and peter quartey idpm, university of manchester may 2000. The smes sector in ghana is estimated to be made up of 70% of all industrial establishments. Research evidence was gathered via a questionnairebased survey of selected agribusiness companies in ghana. Pdf issues in sme development in ghana and south africa. The size of the firm appears a more important factor that determines the profitability in smes in the uk. Such impressive performance was partly contributed to the robust growth of the sme sector in ghana. Small business in accra, ghana list of small business ghana. The theoretical framework of the study explained the various definitions of smes and how ghana as a country classifies smes. Basically the research focuses on sunyani municipality as the main area of study, but it will also cover the problems of smes for the other parts of the world under the same main purpose of this research. A number of new initiatives, including educational programmes and a specialised support fund for small and mediumsized enterprises smes, have been established to promote the growth and diversification of small businesses in ghana. Read online financing small and medium enterprises smes in ghana. Authority of the ifrs for smes p decisions on which entities are required or permitted to use the iasbs standards rest with legislative and regulatory authorities and standardsetters.