Minister of State in-charge of Private Sector Development and PPP, Rashid Pelpuo says access to finance remains a key constraint for Small and Medium-scale Enterprises (SMEs).

According to him, challenges in accessing capital at competitive costs have proven to be harmful not only to the private sector but the entire economy.

Mr Pelpuo, who made this known at the launch of an SME Finance Fair in Accra yesterday, said the high interest rates were adversely affecting the SME sector.

He said the challenges faced by the SME sector had affected the country’s export performance, competitiveness, employment creation and revenue generation.

“There is no gainsaying that more has to be done to aid our SMEs,” he said.

The minister said a fundamental challenge in Ghana was encouraging and fostering the rapid development and growth of SMEs, attributing the situation to inadequate access and the exorbitant cost of funding to the sector by financial institutions.

Mr. Pelpuo said the significance of SMEs to Ghana’s development could not be overemphasized, stating that “over 40 percent of Ghana’s GDP is generated from SMEs and they, therefore, have an impact on economic growth, income and employment.”

He said Ghana could only succeed in her economic transformation agenda and create the needed jobs if SMEs develop and succeed.

. The Minister said SMEs would need to invest in technology, information, machinery, human resource, adding that these require financing.

Mr Pelpuo said SMEs were crucial to government’s transformation and growth agenda and reiterated government’s commitment to creating the enabling environment to build local capacity of the SMEs.

The launch of the SME Finance Fair was to help find lasting solution to challenges faced by the sector and expose innovative financing mechanisms in the country currently.

The fair would reduce the cost of information asymmetry and its attendant effects by bringing the banks, NBFIs, government agencies and multilateral agencies and SMEs together in order to bridge the financial intermediation gap.

Slated for March 16-17, 2016, the fair is themed: ‘SME Financing in Ghana-Enhancing Access and Reducing Costs.’