Ms Abena Amoah, the Managing Director of Ghana Stock Exchange (GSE), has stated that the country can leverage on its domestic market to mobilize capital for development, while assuring that there is money in the country.
Ms Abena Amoah explained that there is enough money in the country which could be assessed by the State Owned Enterprises (SOEs) through the local capital market- the Ghana Stock Exchange.
“Government can be able to borrow the GH¢130 billion that it seeks to restructure now. Our private pensions industry has about GH¢40 billion under management. SSNIT has over GH¢12 billion under management.
“There is money in Ghana and the lesson is that international capital markets are closed to us but domestic capital markets can be built to raise the money we need to develop our country.”
Ms Abena Amoah
The Managing Director of GSE disclosed that companies listed on the Ghana bourse have collectively raised over GH¢20 billion on the stock market; GH¢12 billion from the Ghana Fixed Income Market and GH¢8 billion from the main equities market.
“We need SOEs like Ghana Re, Ghana Gas and the stronger ones to list on the market. What makes capital markets grow is when you bring your best, because the investors need a strong success story.
“We are willing and able to work with the rest progressively. When they have a massive capital plan that has a good balance, we will migrate them onto the market.”
Ms Abena Amoah
10 SOEs Ready for Listing
Ms Abena Amoah disclosed that ten (10) state owned enterprises (SOEs) have been prepared and ready for listing on the Ghana Stock Exchange.
Meanehile, the 10 SOEs were identified by the GSE, together with the State Interest and Governance Authority (SIGA) and the Public Enterprises Ministry after a market readiness assessment was done.
Despite controlling about half of the country’s assets, SOEs in Ghana have largely been a drain on the country’s resources rather than being a tool for economic development, forcing the president to recently caution non-performing SOEs. The 175 SOEs, contribute just five per cent to the country’s gross domestic product (GDP).
The underperformance of these SOEs is largely as a result of mismanagement, which led to some legacy debts, which in turn makes it difficult for them to raise additional capital to expand their businesses.
At the moment, most of these SOEs have made appeals to the government through the Ministry of Finance to assist them to recapitalise their businesses.
Contributing to a panel discussion, Abena Amoah iterated that the stock market presented the best opportunity to raise additional capital for these SOEs.
“The stock exchange presents an opportunity to strengthen and grow SOEs. GCB Bank, Goil, SIC, among others are some of our success stories on how the stock market can help develop SOEs.”
Ms Abena Amoah
Ms Abena Amoah noted that the President could, therefore, sign off the 10 identified SOEs to enable them list on the market.
“At the stock exchange, we focus on accountability and transparency and these are very important to build sustainable businesses. Aside giving you capital, being on the market also ensures that you are able to manage your capital and be a long term global player.”
Ms Abena Amoah
Let’s be Cautious
The Director General of SIGA, Mr Edward Boateng, on his part, said the country must be cautious in the listing of some of its SOEs.
Mr Edward Boateng, however, averred that the country must be careful not to list some of its strategic assets whereby they may fall into foreign hands.
“It’s not just Ghanaians who invest on the capital market, with funds coming in from Abu Dhabi, Toronto, and all over the world,” he said.
On the equities market, 60 per cent of trades are by foreign investors. On this note, Mr Boateng intimated that the country must, therefore, ensure that there is local capacity such that when some of these strategic SOEs are listed, the local entrepreneurs and local institutions could take them up.
“So, we are looking at all those options but definitely some of these SOEs are going to be listed on the stock exchange or in some cases privatised or divested off government hands so that government can focus on its core mandate.”
Mr Edward Boateng
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