The Director-General of the Securities and Exchange Commission (SEC), Mr Adu Anane Antwi, has advocated the development of long-term investment plans as a sustainable means to achieving Ghana’s development goals.
According to him, long-term investments were key components that drove economic growth and development of every country, and until Ghanaians stopped thinking about short-term investment plans, the country’s development agenda would remain short lived.
Mr Antwi was addressing a media breakfast launch of the upcoming Ghana Pensions and Sovereign Funds Investment Forum (GPSFIF) on May 22, which is scheduled for June this year and being organised by the Africonomie Ghana, a boutique marketing and communications services firm.
He said long-term planning and investment would not only generate an evolving fund for investors, but help in the development of the needed fixed assets including infrastructure and amenities for the country’s development.
The forum is expected to attract selected senior executive and create the platform for effective networking on contemporary investment, management and administration issues, impacting pensions and sovereign funds investments in Ghana, and also discuss private equity and real estate as an asset class for institutional investors.
Mr Antwi said although economic development dwelt mainly on advance capital market and long-term investment, the country’s market development efforts were currently being challenged by the high level of financial illiteracy among stakeholders.
‘Knowledge of the capital market especially is very low in the country and this directly affects the number of Ghanaians investing in the equity and bonds market,’ he said.
He said there was therefore the need for regulators and operators to collectively step up the education drive to educate investors on how to maximise their investments using the capital market as an investment avenue.
According to him, capital markets enhanced financial intermediation, increased mobilisation of savings, improved efficiency and volume of investments, and aided economic growth and development.
‘The development of the capital market is therefore a necessary condition for the development of the economy’, he said.
New Pensions Act
Mr Anane Antwi gave a brief background to the new National Pensions Act of 2008 (Act 766), which introduced reforms into the country’s pension system with a three-tier pension scheme.
He said the privatisation of the management of the second and third tiers of pension had resulted in increased flow of pension funds into the capital market, and that, ‘this circulation of pension funds would have a significant impact on the development of the capital market in Ghana.’
He said prospects for the establishment of sovereign funds by the Government of Ghana, including the Ghana Infrastructure Fund had also heightened awareness of long-term investment in the country.
Chief Executive Officer of the National Pensions Regulatory Authority, Mr Laud Senanu, said his outfit endorsed the forum, and expressed the hope that it would signal the beginning of collaborative work to build a vibrant market for the growth and development of the country.
Real estate fund
Mr Anane Antwi cited the promotion of the Real Estates Investment Funds (REIFs) which would create a strong link between the capital market and the real estate sector to help the housing deficit in the country as some of the initiatives of the SEC aimed at developing the Ghanaian capital market.
The REIFs would also create a long-term investment avenue for investors and would be closed end funds, which would be listed on the Ghana Stock Exchange to deepen the market.
The President of the Ghana Chamber of Commerce & Industry, Mr Seth Adjei Baah, admitted that talking about private sector as the engine of growth without long-term funding investment was no vision.
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