Interview: Herman Chinery-Hesse
What types of initiatives could encourage entrepreneurship in the IT sector?
HERMAN CHINERY-HESSE: The most important thing is for government to promote the IT industry, but that is not happening yet. I am not suggesting we should create some type of extended protection for our IT companies, but I do believe we need to promote some type of incubator system for new IT ventures.
A very simple initial measure would be for government entities to use local software where possible. The fact that the government does not choose to use local software when it can has two major effects. The first is that we miss the opportunity of creating more employment by supporting local industries. The second is that it gives a bad name to Ghanaian companies trying to export IT, because international competitors can point to the fact that even the Ghanaian government buys software from international companies and not local ones that can do the job just as well. Our government generally does not seek advice from the industry, so there is a disconnect between the industry and government policy. We should seek to promote cooperation between the government and the IT industry.
What can be done to increase the usage of more advanced IT systems among SMEs in Ghana?
CHINERY-HESSE: Affordability is a problem. Equipment is cheap, but software and services are expensive. However, this can be overcome. The software business can apply the same model that has been employed by telecoms companies in Africa. Most companies do not have money for proper accounting or payroll systems. But if you go to the bottom of the market and find specific solutions for small businesses, you can overcome that. Now we are basically applying the models initiated by fast-moving consumer goods companies in Africa to the software industry. This type of customised, low-cost solution can expand IT use among the smallest businesses.
How can Ghana position itself as a software developer and exporter in West Africa?
CHINERY-HESSE: There is potential for increased IT exports into the whole region. Instead of waiting for government to open the doors for companies, companies must go directly to consumers and develop products that meet the population’s specific needs.
Unemployment could be solved by developing a solid IT industry. While infrastructure is catching up, this is where we need to focus. We should jump a stage in our development and focus on promoting the creation of new technologies and systems. Instead of focusing on foreign investment alone, we must promote the development of indigenous ventures.
What new developments are occurring in technology-based payment and trade systems? What limits do you see for the use of these systems?
CHINERY-HESSE: We are currently establishing an internet platform that will help develop small businesses in rural areas. We get together with artisans and help them improve the marketability of their products, adapt them to European tastes and conditions. This is being accomplished through private investments from the US.
Through our Shop Africa platform we connect merchants to international markets and receive 10% of each exchange in return. The merchant gets a message on his mobile phone telling him what they sold, they know what they need to produce, how many units, and the date of delivery.
The same platform can be used to transfer remittances from Ghanaians abroad directly into the local recipients. We can even set up an account with a merchant or a shop where the remittances money is directly used to pay for products here. You cut out the “middle man” companies in transferring remittances and make sure the money is used for its intended purpose. This is just an example of how IT can be used for economic growth. There is no limit.
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