Evaluation of the Economic Impact of Start-ups and Small and Medium Enterprises on Ghana's Development : A Comprehensive Analysis

Abstract

Small and medium enterprises (SMEs) and start-ups are essential to the Ghanaian economy, as they significantly contribute to job creation, poverty reduction, and overall economic growth. Despite these contributions, Ghanaian SMEs encounter substantial obstacles, including inadequate support structures, skills deficits, and restricted access to financing. This study examines the socio-economic environment in which these businesses operate, evaluates the role of digital transformation and innovative financing models, and evaluates the emerging trends and challenges within the SME sector. This thesis thoroughly examines the primary factors that impact the sustainability and growth of start-ups and SMEs in Ghana, utilizing a combination of primary and secondary data sources, such as government records, business registrations, and industry reports. It was discovered that SMEs in Ghana account for approximately 60% of GDP and constitute over 90% of businesses. However, they are still underfunded and lack adequate support systems. The analysis also emphasizes the new opportunities digital solutions and e-commerce provide for these enterprises to surmount traditional barriers. The study concludes with strategic recommendations for developing a more inclusive and resilient entrepreneurial ecosystem in Ghana, underscoring the urgent need for these changes. By addressing these challenges, Ghana can significantly increase the impact of SMEs and start-ups, thereby enhancing overall economic development.