YouStart initiative must succeed

The government recently signed an agreement with 13 banks in the country to make available about GH¢5 billion to small and medium enterprises (SMEs) under its YouStart programme.

The funds are to be disbursed over the next three years under an initiative that aims to support the youth to start and sustain their own businesses.

The Finance Minister, Ken Ofori-Atta, and representatives of the partner financial institutions (PFIs) signed the various memoranda of understanding to commence the implementation of the programme which was announced earlier this year.

The banks are to be coordinated by the Ghana Association of Bankers (GAB), an advocacy body for banks in the country.

The Daily Graphic welcomes this stage of the implementation of the YouStart initiative because of the impact it will make on small businesses and start-ups in the country.

For many decades, the major challenge that SMEs and start-ups have been confronted with is the lack of financial support to enhance their operations.

We are aware that in many instances the financial sector operators have refused to lend support to these businesses – describing them as too risky to lend their customers deposits to.

In recent times, there has been increased interest shown by some banks in the country in such businesses and that is laudable albeit there is more room for improvement.

It is also against this background that the Daily Graphic finds it heartwarming that 13 banks in the country have so far committed to support the government’s initiative with Gh¢5 billion over the next three years.

It comes at a time when the twin global events, COVID-19 and the Russia/Ukraine war, have exposed the gap in our preparation to withstand tough times.

We are of the firm believe that our people have the zeal, tenacity, will-power and knowledge to make things work for them once they are able to get the needed support.

At a time when we have noticed the need to reduce our imports to save the local currency and tilt the balance of payments in our favour over time, it is important for us to ensure that we make it a deliberate policy to support all SMEs and start-ups to produce to meet local demand and also for exports when the need arises. The quest to take import substitution more seriously must be alive on our minds at all times.

The Minister of Finance in his remarks during the signing of the Memorandum of Understanding (MoU) with the banks, said fundamentally, we had to adopt this approach because the pandemic taught us that we must re-orient our approach towards structural transformation and react with a clear plan to reap the benefits of our population by building an entrepreneurial state.

This focus on building our young people’s skills and entrepreneurial instincts is an informed one and we share in this thought because that is the reality we must face at all cost.

Data has shown that about 50 per cent of local employers reported misalignment of or inadequacy of skills in the market, with Mckinsey also reporting that at least 50 per cent of new tertiary institution entrants enrolled in programmes in sectors with little or no growth in the labour market.

On the other hand, the Ghana Statistical Service (GSS) also suggested that the unemployment rate for those aged between 15 years and 35 years was 19.7 per cent.

Even for those who are perceived to be working, 50 per cent of them are classified as under-employed.

This is, in fact, a dire situation which we, as nation, must take seriously. It calls for a concerted effort to ensure that it works for all.

The signals given about the threat posed by a large number of unemployed youth to our national security is what must engage our thoughts for an amicable solution.

This is why we at the Daily Graphic fully commends the 13 banks which have lent their support to the programme so far, and urge the rest to also come on board.

We use this opportunity to prevail on beneficiaries to help sustain the programme by ensuring that whenever they access funds to invest in their business, they repay on time for others to also benefit in order to sustain the programme.

It is important because it will also help to demystify the myth around them as risky businesses.