As Support For Government’s One-District, One-Factory
The management of the Universal Merchant Bank (UMB), has earmarked 100 million United States dollars to support the Akufo-Addo’s government’s one district, one factory initiative.
The Board of Directors of UMB Bank, led by its Board Chairperson, Betty Zormelo, disclosed this when they paid a courtesy call on President Akufo-Addo at the Flagstaff House in Accra, last Thursday.
UMB Bank, is reportedly owned by businessman Ibrahim Mahama, younger brother of ex-President, John Dramani Mahama, who the New Patriotic Party (NPP) had accused of collapsing the then state-owned Merchant Bank with a loan of GH¢57 million to his company, Engineers and Planners (E&P)
The NPP led by Mr. Akufo-Addo, then in opposition had claimed it had established that Ibrahim Mahama owned Fortiz Equity Fund, which eventually bought Merchant, and less than four years, Ibrahim Mahama has revived the comatose state bank, and dishing out US$100 million to support government’s “One District, One Factory” economic agenda.
Ibrahim Mahama’s indebtedness which stood at GH¢175 million was settled before the bank was sold to Fortiz Equity Fund.
Alliance For Accountable Governance (AFAG), which is affiliated to the NPP at numerous press conferences, had called for the assets of Mr. Ibrahim Mahama to be frozen pending investigations into the matter.
AFAG, had claimed E&P’s debt was 19.1 percent of the struggling Bank’s debt portfolio. The group also claimed the loan was reportedly left unserviced by E&P, since President Mahama’s party; the National Democratic Congress (NDC) came to power in 2009.
E&P, had indicated that some technicalities caused the delay in the repayment of the loan, insisting there was a payment plan the company was following in servicing the debt.
The NPP government’s “One District, One Factory” economic policy, is a bold agenda for the transformation of the Ghanaian economy through industrialization. Under the plan, the government will support the creation and growth of small and medium scale factories in all 216 districts in Ghana.
The focus of the meeting was on the President’s flagship agenda of One District One Factory initiative.
According to the government, the initiative is built on enhancing the competitive advantage of each district, through industrialization, and shall be implemented hand-in-hand with the private sector through various private public partnerships (PPP).
However, due to the dire economic circumstances in which Ghana currently finds itself, the government is limited in its ability to provide funding for this project. To ensure the success of this concept therefore, the government is partnering with UMB Bank as its financial partner to implement the One District One Factory concept.
Universal Merchant Bank (UMB), formerly Merchant Bank Ghana Ltd, was a full-fledged merchant bank and can be accredited with the growth of numerous Small and Medium Scale enterprises in Ghana.
President Nana Akufo-Addo also lauded the strong partnership of his government with UMB Bank to establish a Public Private Partnership Incubation Centre to support the One District One Factory initiative.
The President described the announcement as one of his birthday gifts, saying it is a welcome news to him and his government. He tasked the Trade and Industry Ministry to strongly partner with the bank to ensure that the product of the bank is harnessed by interested businesses who buy into the one district, one factory vision of the government.
The Board Chairperson, Betty Zormelo stated that the experience of UMB as a Merchant Bank will be leveraged a “UMB PPP Incubator Centre” solely for the purpose of supporting the needs of enterprises that seek to partner with the government on the “One District, One Factory” concept.
We at UMB are “Big on Small Business” and we see this as an opportunity to offer our expertise in the sustainable implementation of this transformational agenda.
She continued to state that “we understand the business of banking SME’s and know that SMEs do not grow by simply advancing loans to them. The UMB PPP Incubator Centre will, therefore, provide a range of services and technical support, with the aid of our Investment Banking affiliate, UMB Capital”.
The Centre will also provide the following services, Business Plan Development, Financing for SME’s Linking Local Businesses to International and local partnership and funding sources, Funds Management for SMEs Business Advisory services.
The center will also help with corporate governance, business strategy, internal controls, business development initiatives, marketing and succession planning, among other things.
On his part, the Chief Executive Officer (CEO) of UMB; Mr. John Awuah stated that “the goal of UMB will be to help these businesses to become structured, efficient, locally and globally competitive and sustainable”.
The CEO, further stated that he was inviting good business proposals and entrepreneurs to start the application processes through the Bank and all its Business Centre branches across the country.