Local Business Climate in Ghana – Insights for Policy Direction

Abstract

This study provides insights for enhancing the business climate in Ghana. The primary objective of the study was to identify the most relevant binding constraint(s) on the activities of micro, small and medium-sized enterprises (MSMEs) in the manufacturing sector of Sunyani Municipality and Berekum District of Ghana. Accordingly, a survey of 85 manufacturing MSMEs was conducted. In spite of energy crisis in Ghana at the time of research, the most relevant binding constraints to the enterprises surveyed were poor access to technology including technological support services, and poor access to market (which will be discussed in subsequent paper). The findings contradict policy focus on addressing governance and regulatory bottlenecks, and inadequate physical infrastructure. This underscores the importance of local business climate surveys in addition to national surveys in establishing the right policy focus for enhancing the business climate of localities within a country.