Accra, A research report released by the Youth Sector Engagement Group (Y-SEG) has called on government to address the high cost of rent charges in acquiring infrastructure for business operations to ensure their sustainability. It also urged government and policy makers to reduce barriers that impede business registration to formalise the informal business sector.
According to the report, majority of businesses, especially youth-owned enterprises were hardly sustained due to exorbitant rent charges usually demanded by property owners to obtain operational spaces to do business.
“Youth businesses in Ghana face high cost of doing business and this severely threatens their sustainability,” it said.
This was contained in the 2021 Ghana Youth Business Performance and Sustainability Index Report.
The study, carried out by the Y-SEG, Association of Ghana Industry and the Ghana Chamber of Young Entrepreneurs, sought to identify factors that hindered or otherwise the sustainability of youth-owned businesses to inform policy decisions of government
Presenting the findings of the report in Accra, Dr Prince Frimpong, the Lead Consultant, explained that even though recent technological advancement had ensured that businesses thrived without physical space, some particularly those in the manufacturing and industry sectors required a fixed physical space to undertake operations.
Government, he said must, therefore, look for ways to provide some permanent but affordable spaces to such young businesses, especially those owned by the youth to ensure their survival and sustainability.
“Inequality of opportunity opened to youth businesses has the tendency of making the disadvantaged ones fall out of business with all their entrepreneurial skills,” Dr Frimpong noted.
He added that: “As a consequence, there is the need to create more market spaces at affordable prices. This reduces the cost of operations of businesses and, hence, potentially improves performance and sustainability.”
In all, 2,016 respondents, aged between 18 and 35 years were interviewed, out of which 1,105 were males and 911 were females.
It was conducted in all 16 regional capitals of the country.
Three major dimensions were the focus of the research, namely
Social, which comprises the human capital development, the training and the entrepreneurial skills of the owner; the economic dimension, that is the cost of doing business, access to credit and finance and the risk level of doing such business and systems, which included the governing structures, innovation, taxes and registration.
Dr Frimpong, who is also a Senior Lecturer at the Department of Economics, Kwame Nkrumah University of Science and Technology, also identified stable macroeconomic policies as critical factors to the survival of youth-owned enterprises.
He urged the government to develop prudent macroeconomic policies to reduce the cost of doing business.
Mr Mustapha Ussif, Minister of Youth and Sports in a speech read on his behalf by Mr Mohammed Saani, Head of Policy, Monitoring and Evaluation at the Ministry, said government placed a high priority on youth skills development and support of young entrepreneurs and youth-led businesses.
“In promoting sustainability of youth-led enterprises, we are aiming at building well-functioning legal, regulatory public institutions and administrative environment, which is essential as it lessens the burdens of young entrepreneurs,” he said.
Mrs Comfort Ocran, CEO of Y-SEG, urged government and policy makers to adopt the report for the formulation of youth-owned business development policies.
Source: Ghana News Agency