Finance Minister, Seth Terkper has made a strong case for State Owned Enterprises (SOEs) to resort to the Ghana Stock Exchange (GSE) for long term investments.
He argues this will be one way for government to achieve its target of developing the secondary market for the country’s bonds.
Seth Terkper adds that since some of the major projects undertaken by government require huge investments which often leads to the issuing of bonds to raise such capital, it will equally be prudent to consider doing same via the stock market.
“It is important that we should develop the secondary market where SOEs will partner the GSE for the long term needs and for the private sector to also do same,” he stated when he addressed this year’s Ghana Economic Forum.
“It is also important that we develop the corporate bonds market as a source of long term investments because we have got households and businesses who borrow from the domestic market,” Mr. Terkper added.
The Minister’s comment follows concerns by the private sector and other economic watchers who believe that the government’s continuous borrowing from the domestic market will crowd the private sector from accessing funds for expansion.
The suggestion also comes at a time that the Securities and Exchange Commission [SEC], has intensified its call for multinationals to list on the Ghana Stock Exchange.
The Director General of SEC, Dr. Adu Anane Antwi believes this will retain some profits in the local economy and allow Ghanaians to own parts of such companies.
“If we get some of these companies list part of their shares on the Ghana Stock Exchange, at least parts of the foreign exchange that they take every year in terms of dividends will remain here and that should help us manage our foreign exchange value and the rate,” he remarked.
Though Nigeria’s Parliament has advanced moves to get this backed by law, Ghana is yet to embark on same.
Dr. Anane Antwi therefore wants Ghana’s legislature to also reconsider the country’s position and enact legislations to make multinationals list on the GSE and develop the stock market’s performance.
By: Pius Amihere Eduku/citibusinessnews.com/Ghana