By Isaac Twumasi Quantus in Accra.
African governments need to create a better business environment for the private sector so that companies can generate domestic revenue to help alleviate poverty and boost development.
Even though Africa has enjoyed good economic growth over the last decade, the global economic crisis nevertheless demonstrated how African countries and external flows of funds are at the mercy of unforeseen shocks.
There is therefore the need for policy reform to create an enabling environment for private sector growth and increased domestic revenue.
Financial and price stability is needed for investors to have confidence in investing in the country. There is a need to remove barriers to free movement of people, goods and services.
Accelerating regional integration agenda on the continent is critical to creating a bigger market that will attract investment.
I believe financial institutions need to improve and simplify their services to be able to increase penetration of financial services that could in turn lead to mobilizing more domestic resources.
We should make the bank less of a mystery, reduce transaction costs and increase access to finance. This will boost savings because you will be able to access resources from the unbanked population.
In order to mobilize more domestic resources there is a need to develop robust financial sector that supports growth of the private sector to be the engine of economic growth. Africa’s financial sector is still in its infancy and collection of taxes is still inadequate.
To boost domestic revenue, countries not only need to diversify their economies but also invest in added value to their exports.
This article was originally posted on West Africa Business Communities