• Monday, December 04, 2023
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Micro-enterprises as hub of economic growth


 Minister of Trade and Investment Olusegun Aganga recently launched the National Enterprise Development Programme (NEDEP) for the repositioning of the Micro Small and Medium Enterprises (MSMEs) sub-sector, which is the major driver of economy in the area of job creation and wealth generation.

There is no doubt that focus should be on MSMEs sector if we are going to develop our economy and turn our quantity advantage into productive advantage for the attainment of inclusive economic growth. It is gratifying to note that despite the fact that the sector has not been given the much needed support in terms of access to funding, it has played a big role in the economy with the sector contributing about 75 percent of the country’s Gross Domestic Product and employing more than 45 percent of our people.

The minister said based on their survey in 2010, there are about 17.28 million MSMEs in the country, employing more than 32 million people. Interestingly, 96 percent of the mix are actually micros with about 4-6 percent of their funding from organised lenders and requisite skills for running their businesses.

Expectations are high as the execution of NEDEP is by the parastatals under the ministry – Bank of Industry, Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and the Industrial Training Fund (ITF) – which are, to some extent, not infected by bureaucracy. While SMEDAN will provide business training and support, ITF will provide the skills required for specific or specialised businesses, and BoI will provide the funding.

“This is the first time ever that these three parastatals under my ministry are coming together to develop and implement a programme that will revolutionise the growth of the MSME sector in Nigeria,” said Aganga. “This is quite different from when different parastatals saddled with the responsibilities of seeing to the development of MSMEs had no collaboration that could have a significant impact on the Nigerian economy.”

Therefore, the goal of creating about 3.5 million direct jobs and five million indirect jobs through the project should be achieved through harnessing the database of MSMEs.

Already, the minister said 25 percent of those that have saleable products and businesses will be supported through building their businesses and at the same time providing them with funds. “If we are able to reach the top 25 and each MSME creates one job, [that would be] about three million jobs created within two years. In addition to that, we are looking at One Local Government, One Product, based on the areas where we have competitive and comparative advantage. We are looking at these across the value chain to make sure that even when they produce their products, they will be able to sell them within the same state,” he said.

The planned inculcation of the culture of enterprise development right from the schools through enterprise training in the curricula of various educational institutions, such as secondary and tertiary institutions, is commendable since the initiative will ensure that before students graduate from school, they are entrepreneurially minded with idea of the type of business they want to set up and how they will access funds.