Accra, August 29, 2007 — IFC, a
member of the World Bank Group, today released the findings of its second
annual survey of Ghana’s leasing market. The results show that the number
of new leases issued in the country grew from 311 in 2005 to 536 at the
end of 2006 – an increase of 72 percent. The total lease portfolio represented
by gross lease receivables by the sector also increased by over 73 percent
from $29.8 million in 2005 to $51.3 million in 2006. The report notes a
significant increase in the number of leasing providers, from seven in
2005 to 12 in 2007, with many banking institutions entering the sector.
The Leasing in Ghana 2007 report
represents the most comprehensive survey of Ghana’s leasing market to
date. It highlights major developments in the leasing industry in 2006
and makes recommendations for further improvements in the policy, regulatory,
and tax environments that govern the sector. The report was compiled by
the SECO IFC Leasing Program, a project that seeks to enhance the role
of leasing as an alternative financing mechanism for businesses in Ghana.
Launching the report, Taba Cookey, SECO
IFC Leasing Program Manager, said, “IFC is committed to supporting efforts
that deepen Ghana’s financial sector and expand access to finance for
the private sector. The 2007 survey provides strong evidence that the leasing
sector is playing an increasingly important role in financing the needs
of private businesses in Ghana.”
Philippe Sas, Economic Advisor at SECO,
said, “Leasing is important, because it benefits mostly small and medium
enterprises that generally cannot access financing from banking institutions.
It makes it easier for these businesses to acquire capital equipment even
when they lack the credit history or sufficient collateral to access traditional
forms of financing.”
Speaking at the launch, Dela Selormey,
Head of Banking Supervision at the Bank of Ghana, commended the development
of the leasing sector and outlined various efforts by the bank to support
further growth of the financial sector.
Worldwide, leasing has demonstrated
the ability to increase investment in capital equipment. Leasing plays
an important role in economic development. For example, it is reported
that every 8 to 9 percent growth in leasing activities leads to a corresponding
1 percent average growth in a country's GDP. In developed countries, leasing
is used to finance about one-third of private investments.
IFC, a member of the World Bank Group,
fosters sustainable economic growth in developing countries by financing
private sector investment, mobilizing capital in the international financial
markets, and providing advisory services to businesses and governments.
IFC’s vision is that people have the opportunity to escape poverty and
improve their lives. In FY07, IFC committed $8.3 billion, including loan
participations, to 284 investments in 66 developing countries.
The SECO IFC Leasing Program in Ghana,
which started operations in September 2005, aims to create new financing
opportunities for businesses in the country by promoting leasing as an
alternative financing mechanism. The program is being implemented under
IFC Advisory Services for Africa – PEP-Africa – with funding from the
State Secretariat for Economic Affairs of Switzerland (SECO), under the
Directorate for Economic Development Cooperation.