Impact of the 2024 Elections on SME Policy

The 2024 general elections ushered in a new administration and with it a wave of policy shifts affecting Ghana’s small and medium enterprises (SMEs). From campaign promises to enacted budgets, SME stakeholders have keenly felt changes in funding programs, tax burdens, regulatory priorities, and support for digital infrastructure. This report analyzes these impacts, drawing on early actions by the Mahama-led government and reactions from business associations.

SME Funding and Programs

A flagship election promise was to boost financing for youth and small businesses. The opposition National Democratic Congress (NDC) pledged a Young Entrepreneurs Microcredit Fund with a GH¢750 million seed, yet by early 2025 this had “been conspicuously missing” from government actions and the 2025 budget. Critics note the NDC instead repackaged the previous administration’s YouStart program under a new name—“Adwumawura”—without substantive changes. Youth advocacy group YFA even quipped, “Na sika no wɔ he?” (“Where is the money?”) in Twi, highlighting frustration over the unfulfilled fund. In practice, existing SME support schemes continue under review.

The Development Bank Ghana and Ghana Enterprises Agency remain operative, but entrepreneurs await clarity on new financing avenues. Business associations like the Association of Ghana Industries (AGI) urge government not to stall on SME support, as access to credit remains severely constrained by high interest rates which are however easing at the time this piece is being published. For now, many SMEs must rely on private financing and banks, though the government insists further engagements will “birth innovative, robust approaches” to bridging the financing gap.

Tax Policy Shifts

A headline change post-elections has been tax relief. True to campaign vows, the new government swiftly abolished several taxes seen as stifling small businesses. By April 2025, President Mahama assented to repeal bills scrapping the 1% Electronic Transfer Levy (E-Levy) on mobile money, the “COVID-19” 1% VAT levy, the emissions levy on imports, and a controversial betting tax. This brought much-needed respite to SMEs and individuals. Mobile money transactions, a lifeblood for micro businesses, are no longer taxed 1% per transfer, removing a “roadblock to growth” as critics had argued.

The AGI lauded these moves: “Some of the taxes we always asked to be removed have actually been taken off, so in that regard we are happy,” said AGI’s Greater Accra chairman Tsonam Akpeloo. The elimination of VAT on electricity for small consumers (after labor protests) also spared shops and workshops from higher utility bills. However, tax cuts have a flip side. To maintain revenue, the government is exploring ways to broaden the tax base. Akpeloo of AGI urges bringing more informal businesses into the net so “dutiful taxpayers” aren’t over-targeted. Leveraging technology (like the Ghana Card ID) to track taxpayers is one strategy, as Ghana’s tax-to-GDP ratio (~13.7%) remains below the 18-20% target.

For now, SMEs enjoy lighter tax burdens – the 1.5% in total levy cuts on VAT and electronic payments should marginally ease costs – but they should anticipate stricter compliance enforcement ahead.

Regulatory and Business Climate Reforms

The election outcome catalyzed dialogue on deeper reforms to improve the SME operating environment. Within days of the vote, AGI and the Ghana National Chamber of Commerce and Industry (GNCCI) met with the incoming government’s Business Development Committee to press for action on longstanding issues.

Exchange rate stability topped the agenda, as cedi volatility has been “a thorn in the flesh” of industry. Business leaders stressed policies to stabilize the currency and reduce forex shortages – essential for import-reliant SMEs in trading and manufacturing. Tax system complexity was another focus: AGI President Humphrey Dake underscored that “stifling tax structures” and complicated refund processes discourage business growth. The NDC team signaled commitment to a simpler, fairer tax regime going forward. Power sector costs also saw attention.

Reliable, affordable electricity is “non-negotiable” for SMEs, so discussions were held on reforms for independent power producers and energy tariffs. Notably, the new government heeded calls to suspend a planned 15% VAT on electricity consumption after organized labor and traders’ unions vehemently objected to its “detrimental impact” on livelihoods. This responsive stance earned goodwill among business groups. The administration has also hinted at legislative tweaks: for example, reviewing aspects of the Ghana Revenue Authority Act to make tax administration more business-friendly.

There is talk of reviving a stalled Companies Act amendment to simplify registration, and continuing the push for a unified business digital portal to cut red tape. Early signals are promising – as Spio-Garbrah of the NDC put it, these engagements “weave together policy and practice” so industries can survive and thrive in an increasingly competitive, digitized global economy.

Digital Infrastructure Support

Both the outgoing and incoming governments recognize that digital infrastructure is key to SME growth. The change of government did not derail Ghana’s digitization drive – if anything, it accelerated it under a rebranded Ministry of Communication, Digital Technology and Innovations.

The new administration has embraced initiatives like the Ghana Digital Acceleration Project and continues to expand broadband and IT training. The scrapping of the E-Levy itself is seen as pro-digital: removing that tax is expected to boost e-commerce and digital payments usage by SMEs.

In April 2025, Ghana finally greenlit a pilot 5G network rollout (after some delays) which, once fully deployed, will improve internet speeds and enable advanced digital services for businesses. The budget also mentioned investments in digital public infrastructure such as the national ID (GhanaCard) integration and an Open Data framework. All these efforts support SMEs’ adoption of technology. However, gaps remain – many small firms, especially outside Accra, still struggle with unreliable connectivity and costly data. The AGI has even called on government to review the cost of internet data for SMEs to stay competitive.

On a positive note, Ghana’s new National AI Strategy includes plans to support local tech startups and improve digital skills, which could eventually benefit SMEs with AI-driven tools (see Article 3). In sum, the post-election policy environment has sustained momentum on digital infrastructure, acknowledging that from mobile money interoperability to online business registries, a strong digital backbone is vital for modern SMEs.

Conclusion

Six months after the 2024 elections, Ghana’s SME landscape is cautiously optimistic. The government’s quick moves to alleviate tax and electricity cost burdens have been welcomed by business owners. Engagement with AGI, GNCCI and other private sector players is fostering a collaborative tone. Still, challenges like high lending rates above 30%, persistent inflation, and the need for consistent regulatory reforms temper the optimism.

The impact of election promises on SME policy can thus be summed up as “work in progress.” Key pledges – from an SME fund to an industrialization drive – remain in early or unclear stages, but the direction of policy is pro-business. To truly reset the SME sector on a growth path, implementation will be crucial. As GNCCI’s President noted, government can only help the private sector with “credible and comprehensive data” and sustained action.

Going forward, SMEs will watch closely to see if the new administration delivers tangible improvements in the business climate beyond the first 100 days’ quick wins. For now, many can breathe a little easier with lighter taxes and a listening government, even as they continue to hustle through Ghana’s ever-evolving economic terrain.