The Dean of the University of Ghana Business School, Prof Justice Bawole has noted that for the Development Bank Ghana to make any significant impact in its focal sectors, it must not have a profit-making objective.
According to the Dean, this would only reduce the DBG to the level of the already existing commercial banks, and it would not be able to live up to expectations.
Prof. Bawole stressed that the DBG risks ending up like already existing development banks if the profit-making bottleneck is not addressed.
“One of the things that I can say in that regard will be to not let us go along the business-as-usual model. Business as usual would mean that we set these banks up, and we expect them to make profit and that mandate means that they must immediately move away from supporting businesses that are not immediately making profit into businesses that can quickly pay back their loans.”
“And so we want to encourage government to make sure that the new development bank would focus on specific sectors. Sectors that promote growth,” he added.
He spoke to Citi Business News on the sidelines of an event organised by the University of Ghana Business School as part of the implementation of a nationally tailored training programme on Green Finance in Ghana.
The government is making moves to establish the new national bank as part of efforts to revive the economy from the impact of the pandemic.
The Development Bank, Ghana when established, will focus on agriculture, affordable housing, ICT, among other areas.
Finance Minister, Ken Ofori-Atta has assured that the establishment of the DBG will see a reduction in interest rates for Ghanaian businesses.
Already, a €170 million facility for the establishment of the new national bank has been secured through an agreement with the European Investment Bank.
