Ghana’s Ministry of Finance and the European Investment Bank have signed an agreement for the provision of a €170 million facility for the establishment of a new national bank, the Development Bank, Ghana (DBG).
DBG is an integral feature of the GH¢100 billion Ghana Cares ‘Obaatampa’ Project, which is seeing the revitalisation of the Country’s economy as a result of COVID-19.
The signing of the agreement took place on Wednesday, 19th May 2021, when President Nana Addo Dankwa Akufo-Addo, held a meeting with the President of the European Investment Bank, Dr. Werner Hoyer, as part of his official visit to Belgium.
The €170 million facility, according to Dr. Hoyer, is the largest facility provided by the European Investment Bank for the establishment of a development bank in Africa, or any other project on the continent.
Speaking at the signing ceremony, President Akufo-Addo said “the Development Bank, Ghana, is going to play a very important part in the rapid economic transformation of Ghana, following the onset of COVID-19.”
He said: “We want to restructure the economy and move it from being a mere producer and exporter of raw materials to one that places much greater emphasis on value addition activities. We see this Bank (DBG) as one that will play a pivotal role in this.”
The President indicated that the design and operation of the Bank, “which has been on the drawing board for the last two years”, will satisfy the highest standards, scrutiny and best practices of Development Banks across the world, assuring further that the €170 million facility from the EIB will be used for the purposes for which it was sought.”
President Akufo-Addo emphasised that the provision of the facility signals the determination of Ghana’s continue partnering with the EU, adding that Ghana would fall on the EIB to continue to finance other projects in the pipeline, as the country works to recover from the impact of COVID-19.
The Minister of State-designate for Finance, Charles Adu Boahen, explained that the focus of the government, since the onset of COVID-19, had been to put in place the building blocks for an inclusive and sustainable economic recovery.
“With the overall objective of creating a favourable environment to spur private sector-led growth, the Government of Ghana recognises the importance of a substantial allocation of development capital to critical economic sectors at sustainable interest rates and longer tenures. Accordingly, there has been a heightened need to establish the Development Bank, Ghana.
He stressed that the Development Bank, Ghana would be a central player for Ghana’s economic recovery and structural transformation, “especially given the importance of counter-cyclical support in stimulating private enterprise.”
Dr. Hoyer, on his part, was confident that the establishment of Development Bank, Ghana would help unlock opportunities for growth in Ghana, as well as assist in the rapid recovery of the Ghanaian economy from the ravages of COVID-19.
He noted that the establishment of the Bank is in line with the objectives of the European Union, and will help develop Ghana’s private sector, agri-business, manufacturing and ICT initiatives.
Whilst describing the decision to establish DBG as “a wise one”, the EIB President said the Bank sees the partnership with Ghana as a fruitful one, indicating that the EIB will follow keenly the development and workings of DBG in Ghana.
Rex Mainoo Yeboah, ISD
