The Vice President of the Association of Ghana Industries (AGI), Humphrey Ayim-Darke, has asked that government includes in its stimulus package for industry a strong mechanism to assess its impact on jobs and economic growth.
“We are proposing to the minister and his team, that we want to be involved to create a monitoring and impact assessment wing that can thoroughly say after two or five years of investing X amount of money in my company, I have created X number of jobs, I grew by this and this is the impact on the general economy,” he said.
The erstwhile John Mahama administration provided a stimulus package worth US$26million to drug manufacturers in order for them to attain World Health Organisation (WHO) standards.
Mr Ayim-Darke wondered, however, as to whether there has since been an assessment of how it has impacted the beneficiary companies.
“What has been the impact? What has been the growth? How many jobs have been created as a result of the package? That is the essence of a stimulus package,” he said.
What I am saying is that before this stimulus packages are presented to these businesses, there should be a clause in there that stipulates what impact this stimulus package will have on the economy,” he added.
The has also been demanding that Akufo-Addo government comes clean on how much money it will be making available through its own “stimulus package.” for the industrial sector.
The 2017 budget states that “a National Industrial Revitalisation Programme with a stimulus package for industry will be established.”
The package, according to the budget, will “provide technical and financial support to existing companies that are currently distressed or are facing operational challenges, but are deemed to be viable to benefit from the stimulus package which will put them in operation in the shortest possible time.”
According to government, the stimulus package has become necessary to rescue the sector from its declining fortunes in the last few years.
Data from the Ghana Statistical Service (GSS) show the manufacturing sector recorded -1.1 and -5 percent growth in the first two quarters of last year, even though the situation improved to 3.9 percent in the third quarter.
The situation, the 2017 budget states, “could be attributed to a variety of factors including, but not limited to the high cost of capital; limited access to medium to long term financing; high cost of electricity and unreliable power supply; limited access to land for industrial activity as well as weak logistic and infrastructure support for industrial development.”
During the global financial crisis of 2008-09, the government of the United State injected billions of dollars into companies, especially banks and other financial institutions, to keep them afloat.
The beneficiary companies had to regularly give account of the impact of the stimulus package on growth, job creation, profitability and impact on the economy to congress.