THE Minister of Trade and Industry, Mr Alan Kyerematen, has asked for strong collaboration between the government and the private sector to help deal with the high level of unemployment in the country.
He explained that the high level of unemployment in the country constitutes a major security threat hence the need for the private sector to help address the problem.
“The most critical development challenge confronting our country today is how to deal with unemployment and it does not matter which government is in power, we need to have a strategic approach to deal with unemployment,” Mr Kyerematen said at the 43rd annual general meeting (AGM) of the Ghana National Chamber of Commerce and Industry (GNCCI) on September 11 in Accra.
Annually, about 300,000 people graduate from various tertiary institutions in the country; but only a measly 10 per cent of them find employment after their first year of completing their mandatory National Service, according to data from the Institute of Statistics, Social and Economic Research (ISSER) of the University of Ghana (UG).
More worryingly, it takes as much as 10 years for a larger number of those graduates to secure employment in the country, the institute said, given the low capacity of the country’s industries, among other factors, to absorb the large number of unemployed graduates.
Step up your game
Mr Kyerematen indicated that the private sector must step up its game, if the country’s high unemployment situation was to be curbed in order to prevent a potential national security problem.
“If you add those graduating from tertiary institutions to those from second cycle institutions and you do an accumulation of the numbers, you will realise that we have a major security problem on our hands.
The minister observed that the public sector employment was no longer a solution, because at best it could only employ around 600,000 to 650,000 hands.
“It is only the private sector that can deal substantially with this challenge, and government’s role is to provide the framework that ensures the private sector can create opportunities for employment,” he added.
Although Mr Kyerematen acknowledged that a lot of responsibility has been bestowed on the private sector, he indicated that the sector was capable of rising to the challenge.
The President of the GNCCI, Nana Appiagyei Dankawoso I, stated that the Ghanaian economy performed relatively well in 2018.
He said it was worth noting that the rebasing of the Ghanaian economy resulted in a 24.6 per cent nominal expansion of the gross domestic product (GDP).
According to him, the economy also witnessed a significant improvement in inflation from 16 per cent in 2017 to 9.8 in 2018.
“In May 2018 the monetary policy rate also reduced from 20 per cent to 17 per cent. In spite of this, however, interest rates remained relatively high, undermining business profitability.
“You all agree with me that the private sector could not operate in a weak financial environment. It is in this regard that the chamber commends the Bank of Ghana (BoG) for taking the necessary steps to restore the health and resilience of the financial sector,” he said.
Consequently, he stated that credit to the private sector as a percentage of annual growth increased from the lowest point of 2.44 per cent in February 2018 to 17.3 per cent in September 2018.
“Nonetheless, it was a difficult period with companies facing some challenges in accessing their funds due to panic withdrawal.
“The chamber urges the Bank of Ghana (BoG) to continue strengthening its supervisory and regulatory mechanism in ensuring strict compliance in the industry,” he added.