Nana Dwemoh Benneh, Chief Executive Officer (CEO) of the Universal Merchant Bank (UMB), has prescribed transparency and discipline as essential principles needed by State-Owned Enterprises (SOEs) to unlock private sector capital.
This recommendation by Nana Benneh came during an expert panel discussion at the State Interests and Governance Authority annual conference, which was recently held at Kwahu-Nkwatia in the Eastern Region of Ghana.
This year, 2023’s edition of the conference had over 200 participants in attendance, with the country’s President, His Excellency Nana Addo Dankwa Akuffo-Addo present with other senior officials of his government.
Speaking during the panel discussion, which included Mr. Daniel Wilson Addo, CEO of Consolidated Bank Ghana; Hajia Abibata Shanni Mahama Zakariah, CEO of MASLOC; Madam Abena Amoah, CEO of the Ghana Stock Exchange and Mr. Kwame Okyehene-Mensuo, Ministry of Finance, Nana Benneh recommended that SOEs demonstrate transparency and discipline in reporting standards in order to unlock private sector funding and capital if they seek to grow the Ghanaian economy.
The panel session of the conference was moderated by Mr. Kabral Blay Amihere, Chairman of the National Media Commission of Ghana and Board Chair at Ghana Grid Company Limited.
Emphatically, the panelists stated that though the country is faced with an economic crisis, they are confident about the opportunities available for growth in the economy. Additionally, they expressed conviction in the local accessibility of SOEs to the needed capital and funding as the international lines were restricted.
Also on the panel was Madam Abena Amoah, who noted that the Ghana Stock Exchange (GSE) remained a worthwhile avenue that SOEs can capitalize on as according to her, there were considerable pools of capital locally looking for investment opportunities.
However, Abena Amoah noted that this capital can only be unlocked if SOE’s adapted the ‘rigor and best practice’ of private enterprise in financial reporting and governance.
Transparency is crucial for verification of cash flows
According to Mr. Daniel Addo, transparency is crucial for verifying cash flows, thus, expressed full support for this perspective. By way of demonstration, Mr. Addo mentioned that his bank was able to provide a substantial amount of credit to SMEs located in areas such as Makola just because they are connected to these businesses and have visibility into their financial transactions.
Hinging on Mr. Addo’s point, Nana Dwemoh Benneh noted that it is now possible to achieve this visibility by means of digital payment platforms, giving a clear example that UMB, for instance, had developed a 5th-generation platform marketed as ‘SPEEDPAY’- which could be integrated into SOE payment systems.
Besides, adoption of such a system will not only improve revenue collection and address revenue leakages, but will also assure banks and other finance houses of the viability of the enterprise, on which basis capital structuring could be achieved, Nana Benneh noted.
Together, Hajia Zakariah and Mr. Okyehene-Mensuo agreed that involving the Ministry of Finance early in financial engineering produces better and positive outcomes.
To explain this, Hajia Zakariah used MASLOC as a case for study, which was able to package a successful proposal, to unlock a funding line from the African Development Bank through technical support provided by the Ministry of Finance.
The State Interests and Governance Authority annual conference has become the annual steering conclave for enterprises in which the Government of Ghana has significant stake and regulatory authorities.
The CEO of the State Interests and Governance Authority, Mr. Edward Boateng, during the climax of the panel discussion asserted that the insights gleaned were useful, with the key action point being a push for all SOEs to adapt digital payment platforms so as to leverage on their cash flows.