Promoting public-private partnership for the development of small-scale industries in Ghana

Ghana’s past development path emphasized much on the modernization concepts that focused much on public, investment in large scale industries to a large extent, failed. This led to a switch in attention towards small-scale industries promotion. The basic role of small-scale industries (SSIs) as the engine of growth, through employment creation, income generation, provision of basic needs, and its contribution to the national development has been recognized in all developing countries, including Ghana. With the adoption of Structural Adjustment programmes in an attempt to develop, three aspects of institutional changes will need to be effected towards SSIs development. These are: i) de-emphasising state control of the economy to one where the state will guide and propel the growth of the economy; ii) shifting focus from public-private competition to promotion of partnerships/collaboration/cooperation; and iii) decentralization and devolution of responsibilities. A shift towards enhancing partnership promotion and decentralisation and devolution will require that stakeholders involved in SSIs development should limit bureaucracy, become more dynamic, and promote transparency and accountability. To enhance collaboration further requires that, should stakeholders ensure free flow of information, regular networking, mobilisation and pooling together of resources in the districts. Partnership promotion in SSIs demands that beneficiaries are involved in all stages of policy making, planning, management and evaluation processes. However, most SSI operators do not benefit significantly from these processes, because the institutional and management capacities of stakeholders, as well as the legal framework available in most of the districts do not facilitate the process. These problems are applicable and evident in the Techiman District where in addition to the weak institutional management capacities, as well as lack of legal framework, there is no focused attempt or conscious effort in place to enhance the operations of SSIs and propel their sustainability. The study identified and examined the SSIs supporting institutions and the roles they play, the extent of any collaboration and their effects on operations of SSIs, it suggested how the interface between stakeholders can be effectively managed, and finally suggested recommendations to improve performance of SSIs in the country. The key concepts of small-scale industry, public-private partnership; public; private and civil society sectors were defined to throw more light on factors necessary for collaboration. A framework for analysing public-private partnership/collaboration was proposed and factors were identified and applied as determinants for successful collaboration. These factors included; participation, information flow, networking, transparency and accountability, establishment of rules and regulations/conduct of business, capacity building, coordination, establishment of joint institutions and joint development of visions, goals and criteria for development. The study was carried out in the Techiman District. Existing Collaborative Schemes like the Rural Enterprises Project (REP), the Village Infrastructure Project (VIP) and the District Poverty Alleviation Fund (DAPAF) operated by the Techiman District Assembly (TDA) were studied. Besides, the extent of collaboration among the stakeholders was examined. The study identified a number of factors and problems including: inadequate and low capacity of staff and beneficiaries, inadequate flow of funds, poor political commitment, absence of joint development visions, goals and criteria for future development; absence of joint development and implementation of programmes; and absence of joint institution. These result in weak collaboration among the stakeholders undertaking SSIs promotion. The study also identified problems of SSIs including: limited access to credit; high cost of transportation; high cost of inputs; unfavourable policy environment; limited access to infrastructure; low technical and technology skills, limited managerial skills; and low demand for products. Other findings established include: low level of education of entrepreneurs; few registered businesses due to the ignorance of small scale Industry operators of responsible agency; for business registration; and domination of apprenticeship as the main form of employment practice. The study concluded by providing specific recommendations including; building the capacities of stakeholders on regular and systematic basis; participation in all aspects of the planning, implementation, monitoring and evaluation process; formulation of policy guidelines on private-public collaboration; mobilization of financial, material and human resources by all stakeholders; and coordination of all activities/programmes of stakeholders through creation of a forum to undertake harmonization and coordination or regular basis. Others include, decentralisation of activities of Registrar-General’s Department, the formation of business partnerships, co-operatives, and joint ventures, to access credit, formation of credit committees by stakeholders to screen approve and coordinate all loan schemes in the district, group guaranting of loans contracted. To improve the enabling environment, there is the need for stakeholders to liase with utility providers on joint development of strategies to improve the supply of such facilities to site and others. There is also the need to create a stable macroeconomic environment towards promoting the sustainable operation of SSIs.

Source: KNUST