The belief in several circles, especially amongst stakeholders, is that the small and medium scale enterprises (SMEs) present a veritable platform for not only growing the Nigerian economy, but also to transform the average living standard of the populace through employment opportunities and income generation. AUGUSTINE OKEZIE examines the inherent opportunities and capabilities that can be realised by engaging in SME-related activities by individuals and groups.
There is a general consensus of opinion that earnings from Nigeria’s gross domestic products (GDP), is capable of increasing from the current level of about $300 billion to over $500 billion within a short space of time, and thereby promote economic growth, if government, relevant stakeholders and the unemployed, focuses more on the development of Small and Medium Enterprise (SMEs) business in the country.
Former Deputy Governor of the Central Bank of Nigeria (CBN) in charge of operations, Mr. Tunde Lemo, even provided further assurance on the projection during a reception dinner, organised in his honour by the Electronic Payment Providers Association of Nigeria (EPPAN), for his meritorious service and commitment in driving electronic payment system in the country.
According to him: “All over the world, SME is key to real sector growth. In advanced economies, SMEs account for over 50 per cent of the volume of businesses transacted. If Nigeria must grow the double digits in financial inclusion, she definitely has to look at SME growth and provides all it takes for SME businesses to flourish in the country.”
He said further: “Thank God that President Jonathan’s transformation agenda is also targeting SMEs. Recently there was a launch of Micro, Small and Medium Enterprises (MSMEs) and about N220 billion was earmarked for it. The bulk of Nigerian businesses are in MSMEs and so if government can give them access to finance and provide them with infrastructure such that cost of business is reduced, through availability of electric power, then the Nigeria economy is set to blossom.”
Also reacting to the capability of the SMEs to drive economic growth, Ekiti state governor Kayode Fayemi described Small and Medium Scale Enterprises (SMEs) as the bedrock for economic development.
Speaking at the third Southwest Regional Integration Forum, with the theme:, “Micro SMEs as Solution to Unemployment and Economic Development”, held at the Fountain Hotel, Ado-Ekiti, Ekiti state, Fayemi said the role played by SMEs in the development of the economy had been attested to by reports, which indicated that strong and vibrant SME was at the very core of economic development and prosperity of any nation.
The governor said unemployment has reached a crisis level that is capable of stagnating development, adding that it is a scourge that must be tackled.
“This programme is a step in the right direction in setting our region back on the path to economic development. If we don’t tackle the scourge of unemployment, we will all be consumed by it even in our air-conditioned offices. We must therefore look for creative and innovative ways to tackle this problem, which is what this forum is aimed at achieving,” he said.
The Managing Director of Vintage Press Ltd, Mr. Victor Ifijeh, said SMEs have been the bedrock of economic prosperity of many Asian countries, contributing 30 per cent to their Gross Domestic Product (GDP).
He said although SMEs represent about 90 per cent of the total industrial sector, it, unfortunately, contributes only about 10 per cent to the country’s GDP.
According to him, SMEs are capable of turning the tide against unemployment, which has been described as a time bomb.
“In this forum, I believe though the SMEs, youths will get to know the opportunities, which abound and those who are already in it will find more creative and innovative ways of doing business,” he said.
A legal luminary, Chief Afe Babalola noted that after the global financial crisis of 2008, there has been renewed global interest in SMEs.
Stressing the importance of SMEs to global economic recovery, the legal luminary noted that between 2002 and 2008, the SME sector created about 9.4 million jobs. “It is clear that the governors, who are encouraging the establishment of SMEs, are good visionaries. I believe they have what it takes to diffuse unemployment and provide bedrock for economic development.”
The Special Adviser to Lagos State Governor on Regional Integration, Rev. Tunji Adebiyi, made a case for the youths, particularly the unemployed, to embrace governments and private sector mobilization train by establishing cottage industries and small business ventures, for their good and that of the country agriculture as a catalyst for regional development. Drawing examples
Adebiyi said the unemployed should come up with proposals that must ensure that agriculture and agro-allied businesses and SMEs, receive access to appropriate financial support and that the country’s financial sector become involved in financing opportunities in the agric sector.
He berated the youths for waiting for white collar jobs and government created employment opportunities, before they can get their hands into something doing. He further cited the recent incident where some people died while scrambling for immigration jobs at the national stadium Abuja, as a bad omen.
Mr Adebiyi maintained that the incident cited above, is avoidable as the population of candidates seeking government employment would have grossly reduced if the candidates become self reliant through SMEs.
In the words of the former CBN deputy governor, ’’Currently our GDP is being reviewed, and when that is concluded, we are sure to have close to $500 billion GDP. Today our GDP is a little less than $300 billion and when that is achieved, we will become the biggest economy in Africa, governments at all levels should support SMEs fully, by recognising the sector as key to economic growth, then the Nigerian economy would become an economy to watch.
In a related development, and on the need to grow SME business in the country, Chief Operating Officer of Computer Warehouse Group (CWG), Mr. Philip Obioha, said part of the company’s five-year plan for technology developments in Nigeria, is to provide bundle services solutions that would help the growth of micro, small and medium scale enterprises in the country.
According to him, proper development of SMEs would lead to the growth of spin-off industries and subsidiary firms, thereby creating employment and increasing the country’s GDP growth.
SMEs have played and continue to play significant roles in the growth, development and industrialization of many economies the world over. In the case of Nigeria, SMEs have performed below expectation due to a combination of problems which ranges from attitude and habits of SMEs themselves through environmental related factors, instability of governments and frequent government’s policy changes and somersaults.
Small and Medium Scale Enterprises (SMEs) in Nigeria sub-sector , can only perform its critical role of driving the country’s industrial transformation and Development as it has done in other developed countries, when it is fully embraced by relevant stakeholders, especially the unemployed.
