The Nigerian Economic Summit Group (NESG) Micro-Small and Medium Enterprises (MSME) Community of Practice and the Federal Ministry of Finance, Budget and National Planning organized a pre-28th Nigerian Economic Summit (#NES28) event ) on the theme “Key Drivers of Economic Prosperity: A Critical Look at Entrepreneurship Policies. »
The NESG Board Director, Ms. Wonu Adetayo, in her welcome remarks, said that the day’s event was organized by the NESG MSME Community of Practice and that the Nigerian entrepreneurship system continues to thrive. combat the pandemic-induced recession and current macroeconomic issues. of the Nigerian economy.
She noted that access to finance and the poor business environment in Nigeria exacerbate the problems in the economy, and even though the Nigerian economy continues to show resilience, many MSMEs continue to struggle with the impact of the challenges.
In addition, Ms. Adetayo noted that the 2021 MSME Survey reported a 4.5% decline in MSME growth, indicating a drop from 41.5 million recorded in 2018 to 39.6 million in 2021, mainly due to the impact of the pandemic; which means that 1.9 million MSMEs disappeared.
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“As Nigeria looks to welcome a new government, economic growth should be a frontline issue and an area of immediate focus, given that entrepreneurship is a key driver of the economy.
“To implement policies and interventions, entrepreneurship policies need to be addressed, including the resulting gaps, and this event will review key policies around thematic areas to promote access to finance,” she said.
In his presentation, the Chief Economist and Director of Research and Development NESG, Dr. Olusegun Omisakin, said there was a need for the Nigerian oil sector to perform well given that the growing non-oil sector is not contributing not job creation.
He revealed that returning inflationary pressures and declining purchasing power are affecting the Nigerian economy and that weak growth combined with inflation and unemployment can lead to recession and social unrest.
In addition, Dr. Omisakin said that access to credit and an unconducive business environment impact production capacity and commodity prices and contribute to inflationary trends; noting that the relationship between oil prices and trade surplus shows that 79% of Nigeria’s total exports are crude oil, but the country has failed to use it to its advantage, resulting in a decline in foreign direct investment (FDI).
The Minister of State, Federal Ministry of Trade and Investment, Ambassador Mariam Katagum, who was represented by Mr. Sunday Ewans, Director for Business and Promotion, Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), said key policies focus on areas that affect small businesses. She noted that micro-enterprises make up the majority of the 39.6 million MSMEs in Nigeria, accounting for over 95% of all MSMEs.
She further revealed that in a 2020 MSME Impact Assessment survey, small businesses said they lacked adequate access to affordable finance, skills and market access. .
Ambassador Katagum further revealed that the ministry has set up an MSME development fund based on a public-private partnership model to help develop a strong program that small business owners can tap into.
She noted the importance of a regulatory environment and the enactment of policies that encourage the ease of doing business to support and make small businesses efficient by creating a platform for regular interaction among stakeholders to facilitate feedback mechanisms that can support them and help them meet their challenges.
On his part, the Managing Director/CEO of the Development Bank of Nigeria (DBN), Mr. Tony Okpanachi, said that the DBN provides technical assistance to financial institutions, partial credit guarantees and capacity development for MSMEs.
He noted the existence of a financing gap in the sector which affects the availability of finance for MSMEs.
Mr. Okpanachi pointed out that financing problems for MSMEs can be linked to a lack of bankable projects, proper financial records, collateral and a lack of ability to scale their businesses to attract the right kind of finance.
He revealed that around 572 billion naira had been distributed through financial institutions and 235,000 MSMEs had accessed the funds, with 67% and 27% of businesses owned by women and youth respectively.
During the panel discussion, Dr. Ezra Yakusak, Executive Director/CEO of the Nigerian Export Promotion Council (NEPC), who was represented by NEPC Deputy Director, Ms. Esther Ikporah, said there was need to have more private sector actors to support MSMEs with access to global finance.