Ghana’s government through its Ministry of Finance (MoF) in partnership with the Security and Exchange Commission (SEC) has launched a 10 year Capital Market Master Plan (CMMP).
The move is part of its drive in building a robust and sustainable long-term financial market to enhance the country’s accelerated development towards the socio-economic growth of the country.
The launch under the theme, “In pursuit of a deep, diversified and well-regulated capital market for accelerated growth and development”, is designed to help address the lack of long term funding and the lack of adequate funding to the productive sectors of the economy.
Speaking at the event, the Minister of Finance, Ken Ofori-Atta said it is very important for industry players in the financial market space to position the country’s capital market to have a competitive edge to enable it benefit from global funds.
“The Capital Market Master Plan will help improve diversity of investment products and liquidity of securities markets thereby adding value to investor participation and enhance market liquidity”, he said, adding that it also helps increase the investor base and promotes innovation and product diversification.
He said access to finance on affordable terms is a major challenge to Ghanaian businesses hence the Bank of Ghana and the Security and Exchange Commission have put in place prudent measures in the last three years to create a conducive financial environment with institutions that are better capitalized and well positioned to lend to businesses.
In addition, strengthening infrastructure and improving market services to improve market integrity, accessibility and boosting regulation, enforcement as well as market confidence.
He however described these factors as the milestone of the capital market master plan which is deliberately targeted at transforming the country’s capital market into a deep, efficient, diversified and well regulated with full range of products attractive to domestic and international investors.
The Finance Minister, added that CMMP have the target to boost the equity market capitalization of Gross Domestic Product (GDP) from about 15% to 50% at the end of the 10 year period and will help improve equity market turnover capitalization from 1% to 15% and thus explained that liquidity turn over on the fixed income market under the plan that is expected to increase from 42% to 70%.
Mr Ofori-Atta said the CMMP have a target to increase asset under management in collective investment schemes from about GH¢3 billion to about GH¢38 billion and those under managed account from GH¢19 billion to about GH¢28 billion.
Throwing more light on the CMMP, he said the master plan have advantage of allowing for strong development in the real estate sector by creating access to developers which will help reduce the housing deficit.
In a remark, the Director General of SEC, Rev. Daniel Ogbarmey Tetteh said the CMMP will provide a comprehensive framework to propel the development and the growth of the economy as well as the financial market to meet global practices.
He said the masterplanhave come into reality as a result of the collective inputs of industry players in the financial sector under the auspices of the Security and Exchange Commission with support from the Ministry of Finance saying it will make the country as a financial hub in the sub-region.
The World Bank Country Director, Mr. Pierre Laporte challenged industry players in the capital market sector to engage in periodic reforms to enable the country have a strong position at the global market level as the World Bank is committed to support Ghana to achieve its financial market leader in relations to the CMMP.
Ben Laryea reporting from Accra, Ghana
