PROLIFERATION OF MICRO-SCALE COMPANIES IN GHANA
There is a growing recognition of the vital role micro-scale companies otherwise known as small and medium scale enterprises (SMEs) play in economic development. They are often described as job creators, the seeds which grow into big businesses and the fuel of national economic engines. Even in the developed industrial economies, micro-scale companies are very common and numerous and are the largest source of employment. It is therefore of no surprise that interest in the role they play continues to be in the fore-front of policy debates in most countries. Governments at all levels have undertaken initiatives to promote their growth. The issue of proliferation of micro-scale companies is no different in Ghana as they are a characteristic feature of the production landscape and noted to provide about 85% of employment in Ghana. From the food seller on the street to the mechanic in the fitting shop, micro-scale companies are found everywhere; in our homes, vicinities, road sides, schools, markets etc. In today’s Ghanaian business environment, it is almost difficult to see a street without a micro-scale business be it an eating spot, provision store, shoe making shop, mechanic shop, and carpenter’s shop and so on. They are believed to contribute about 70% to Ghana’s GDP and account for 92% of businesses in Ghana. Micro-scale companies therefore have a crucial role to play in stimulating growth, generating employment and contributing to poverty alleviation in Ghana. In spite of their immense contribution to economic development, micro-scale companies in Ghana are not receiving the needed attention, hence their current state and performance is rather below expectation. They lack adequate infrastructure facilities, modern technology for operation, access to finance and credit facilities, issue of capacity limitation, limited access to market or low market share, fragile capital base among others. These issues listed...
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