Top banker
advocates discriminatory tax incentive
Association of
Rural Banks calls for more cottage industries
Top banker
advocates discriminatory tax incentive
Accra (Greater Accra) 07 March
2001
Mr Owusu Ansah, Managing Director
of the Agricultural Development Bank, on Monday advocated a discriminatory tax
incentive policy to meet the innovation needs of Small and Medium-scale
Enterprises (SMEs).
He said revenue from such tax cuts
would enable the SMEs to adopt practical means to enhance their growth.
However, Mr Ansah said this could
only be managed by the government within the framework of good fiscal and
economic policies so as not to cause any imbalance.
He was speaking at a symposium on
the theme "Innovation and Industrial Growth in the Ghanaian Economy"
organised by the Association of Ghana Industries as part of Indutech 2001.
He spoke on "The role of
finance in industrial growth through technology".
Mr Ansah underscored the essential
role that finance plays in the growth of businesses but added that the
traditional role of banks to stimulate industrial growth through loans is in
the main not sustainable.
The banks, he said, are in most
cases unable to cope with the high-risk exposure in the long run, especially
through default in payment of loans, rendering them incapable of assisting
others in need.
Mr Ansah said the absence of a
credit rating system that will enable banks to assess the worth of their
customers before advancing any loans to them further incapacitates them.
He said the only way now is to
look for more innovative means of helping industry through schemes such as the
Venture Capital, Partial Guarantee, Industrial Growth Fund and Mutualist Funds,
adding that most of these schemes have enough security to amortise the debts
that may occur.
GRi…/
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Association of
Rural Banks calls for more cottage industries
Accra (Greater Accra) 07 March
2001
The Association of Rural Banks
(ARB) on Monday called on the Association of Ghana Industries (AGI) and the
Ghana National Chamber of Commerce (GNCC) to establish more cottage industries
to boost employment in the rural areas.
This, it said, would add value to
agricultural products and improve rural incomes, which is necessary to expand
the capacity of rural banks.
Mr Emmanuel Obeng, Assistant
National Secretary to the ARB, made the call when representatives of two rural
banks visited the ARB stand at the Ghana Industrial and Technology exhibition
dubbed INDUTECH 2001. The two banks were the Abokobi and Shai Rural Banks.
Mr Obeng told the GNA that the
focus of the rural banks is to help alleviate poverty within the communities.
He called on identifiable groups
such as traders, farmers, fishermen and women to form co-operatives to enable
them to access loans from the rural banks to support their operations.
Mr. Isaac Addo, Administrator of
the Greater-Accra Chapter of the ARB, appealed to citizens of rural communities
living in the urban areas to return home and buy shares in the rural banks.
This, he said, would expand the
capital base of the rural banks and enable them to contribute effectively to
rural development and poverty alleviation.
He said the ARB has instituted
measures to ensure that rural banks employed skilled personnel, saying,
"we can assure them that this time round we have honest and competent
personnel to manage their funds".
Mr. Samuel N. Dsane, General
Manager of the Abokobi Rural Bank, said between 1999 and last year, the profit
of the bank quadrupled from 54 million cedis to 220 million cedis.
He said that currently the bank's
investment capacity is 1.6 billion cedis, adding that customer deposits stand
at 1.4 billion cedis.
This, he said, is as a result of
increased community confidence in the bank, which is reflected in the increase
of customer level from 2,000 in 1999 to 3,000 this year.
"We have put measures in
place to recoup all funds embezzled by the past management and some staff of
the bank," he said.
"There are also effective
checks in the operational system which make it difficult for any embezzlement
to go undetected."
Mr. Dsane said the bank has set up
a 30 million-cedi Agricultural Development Project revolving fund to support
farmers in the area to boost food production, adding that a scholarship scheme
has also been put in place to assist brilliant but needy students and pupils.
He said as a way of enlarging
their service base, the bank's agency at Madina has started operating on
Saturdays.
Commenting on the Central Bank's
directive to rural banks not to establish agencies in the urban centre, Mr.
Dsane said it is a laudable idea.
"Such moves by some rural banks
defeat the very essence of the rural bank system, which is to attract funds
into the rural areas for development."
Mr. Jonathan Laryea Adjei, General
Manager of Shai Rural Bank, however, called for a review of the Central Bank's
directive, saying "we can compete with the commercial banks when given the
chance".
GRi…/
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