Yemisi Izuora
The Civil Society Legislative Advocacy Centre (CISLAC), and its partners have continued to deepen awareness on challenges that have mitigated growth of Small and Medium business operators in Nigeria.
In furtherance to its sensitization workshops the partners again gathered stakeholders to identify and proffer solution on how to rejuvenate the ailing businesses within that space.
In his remarks at the opening of a two day Stakeholders Capacity Building and Consultation Workshop on Fiscal Support Opportunities/Processes For Mutual Economic Growth of SMEs and Private Corporations in Lagos, Auwal Ibrahim Musa (Rafsanjani), Executive Director, CISLAC, noted that a 2020 MSME survey by PwC estimated the financing gap for Nigerian MSMEs to be about N617.3 billion annually (pre COVID 19 pandemic).
This is in addition to other pressing issues plaguing the sector, including but not
limited to multiple taxation and regulatory challenges.
Musa, further disclosed that a 2022 report jointly released by the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and the National Bureau of Statistics, (NBS), shows that MSMEs account for 96.7 percent of businesses, 87.9 percent of employment, and 49.7 percent of national GDP1.
Totaling about 17.4 million enterprises, SMEs account for about 50 per cent of industrial jobs and nearly 90 per cent of activities in the manufacturing sector, in terms of number of enterprises.
The report, he continued noted that there are at least, 39.6 million micro, small and medium enterprises (MSMEs) operated in Nigeria as of December 2020. This contrasts with over 41.5 million MSME businesses recorded by SMEDAN, as operating in the country, in 2018.
However, he said that the Federal Government on its part has funded businesses through a variety of government-backed organizations (most notably the Small & Medium Enterprises Development Agency of Nigeria (SMEDAN), Central Bank of Nigeria and Nigeria Incentive-Based Risk Sharing System for Agricultural Lending
(NIRSAL Plc.), Nigerian Export-Import Bank, Bank of Industry, Bank of
Agriculture and Development Bank of Nigeria) and has established several
agencies to assist SMEs.
Furthermore, at least 26 of Nigeria’s 36 state governments have set up an SME development agency or office.
Unfortunately, Musa, observed that despite these efforts, access to finance continues to be the most pressing problem MSMEs face in Nigeria with less than 5 per cent of SMEs have been able to access adequate finance for working capital and for funding business growth/expansion according to the National Bureau of Statistics (NBS).
Recent Finance Acts have provided a fairly soft-landing for SMEs whose performance might have been more impacted negatively in the face of the COVID-19 pandemic and projected recession.
However, MSMEs continue to be challenged by multiple taxes & levies, lack of coordination of federal & state agencies, and the absence of a central technology platform for the ease of payment of taxes, are some of the challenges faced by MSMEs.
He said the workshop is in partnership with the Nigeria Association of Small and
Medium Entrepreneur (NASME) and with support from Oxfam.
He said the idea is to amongst other things, strengthen fiscal and technical support
opportunities through capacity-building and relevant consultations between
SMEs and relevant government and professional agencies for mutual economic
growth.
The workshop specifically aims to identify challenges that limit access to
finance for SMEs and the opportunities to be leveraged to inform civic advocacy
for improved access to finance for small business growth/expansion; Sensitize
and build capacity of SMEs on relevant statutory requirements, legal and policy
frameworks, financing institutions, alternative financing instruments and
resources needed to secure funding; and Strengthen platforms for SMEgovernment interface for fiscal support and mutual growth opportunities.
