Access to finance and firms performance : Evidence from West Africa

Author(s)

NAAM DANIEL YENBIRE , HUIZHEN XU ,

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Volume 8 - November 2019 (11)

Abstract

The study assesses the impact on access to finance on firms’ performance in West Africa by employing a generalized linear model based on Enterprise survey data for 15 West African countries.  The study concludes that access to finance has a negative impact on firms’ performance in West Africa. The business environment in which firms are situated has a significant impact on their performance. Firms in West Africa encounter some challenges in securing funds to grow their businesses due to the unfavourable business climates such as corruption, court administration constraints, tax rates, unstable electricity supply as well as an unfair competition that are not properly regulated. Therefore, firms should seek patient funds that could allow them ample time to grow.

Keywords

Access to finance; Firms’ performance; West Africa; Generalized linear model

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