The next NDC government has pledged to work towards formalizing the informal economy.
The aim of the formalization of the informal economy is to increase the contribution of the sector in economic development, which the NDC said, “employs about 90 percent of Ghanaians but only contributes approximately 30 percent to GDP”.
This was made known at the manifesto launch of the party at the University of Professional Studies in Accra yesterday.
The various policies that are aimed at driving this agenda are targeted towards “the Small-and-Medium-Scale Enterprises (SMEs) in order to help them raise their productivity, get access to business support services, and to create more and better jobs”.
Prominent among the policies outlined are “the provision of special financial support to market women and entrepreneurs, granting of tax holidays to start-ups and SMEs to facilitate their growth and expansion”. In addition, the NDC said, they “will ensure that the district provides accountability to the tax payers on tolls and levies that are collected on a monthly basis”.
To achieve this, the NDC stated that they “will encourage the creation of small business associations (SBAs) to help disseminate and promote good business practices that contribute to high efficiency, increased profits, and expanded opportunities for job creation by SMEs”.
The NDC also indicated that they will “assist the sector by simplifying the compliance processes including registration, environmental regulations and tax payment”.
Business registration procedures in Ghana have always been cumbersome. Therefore, simplifying these procedures may take off the struggles that people go through to register their businesses. The manifesto however, did not state how these procedures will be simplified but if well done, will encourage more start-ups that will open up the economy.
Formalizing the informal economy will be a major boost to Ghana’s developmental prospects. However, it will require a lot of commitment on the part of government to achieve this goal.
Government’s commitment to its policies is key because the informal sector of Ghana is very complex and mostly characterized by low wages and irregular incomes, lack access to credit facilities and is female-dominant.
In the heat of manifestoes contest, any government elected into office, should stick to ‘its game plan’, secure more funding and should be transparent in deciding who benefits from its program or otherwise.
Commitment, transparency and continuity are values that every government must embrace to enable it deliver the policies that it may have outlined. Ghana has never been short of coming up with good policies, but the challenge has always been the commitment to their implementation.
