President Bola Tinubu has been commended and criticised for the proposed intervention funds to support manufacturers as well as micro, small and medium-sized enterprises in light of the economic challenges caused by the recent policy measures.
Tinubu had in a statewide broadcast on Monday promised to spend N75 billion between July 2023 and March 2024 to fund 75 enterprises and energize MSMEs with N125bn among other plans to alleviate the sufferings of Nigerians.
In a separate interview with BusinessDay in Benin City on the president’s announcement, which came barely less than 100 days in office, the Organised Private Sector (OPS), said the government’s plan is timely but there should be transparency in the implementation process so that it would get to the target persons.
The OPS, including the Nigeria Association of Small Scale Industries (NASSI) and the Benin Chamber of Commerce, Industry, Mines and Agriculture (BENCCIMA) said the sector should be fully included in the decision-making process of selecting beneficiaries so as to prevent the fund from being hijacked by the political class.
Noma Iguisi, Chairman, Edo State branch of Nigeria Association of Small-Scale Industries (NASSI) said there has to be an open and genuine process put in place to monitor how the funds will be assessed, utilized and repaid because it has always been typical for such monies to end up in wrong hands.
Iguisi recommended that such funds should be channelled through the OPS organizations such as the Manufacturers Association of Nigeria (MAN), Nigeria Association of Small and Medium Enterprises (NASME), and NASSI, who will provide the needed guarantee and monitoring systems in collaboration with other relevant public sector to ensure the success of the scheme.
“The proposed N75bn loans for 75 manufacturing industries at a 9 percent interest rate and N125bn to energize the MSME sector is a welcome development. We believe that if it is properly implemented, it can go a long way in ameliorating the current challenges being faced by these companies as a result of the policies of the new administration of President Bola Ahmed Tinubu.
“There’s no doubt that this kind of intervention will help entrepreneurs have access to funds for either equipment or raw materials purchase, working capital at low-interest rates as one of the biggest challenges of the manufacturing and MSME sector is access to finance.
“With this kind of funding window, companies will ultimately be able to hire more workers which will reduce unemployment in the country, the production output will increase, more profits will be made and these industries may also have the capacity to increase the wages of their workers which is indeed very imperative at this high inflationary times,” he said.
He, however, solicited a minimum period of three months and a maximum of nine months so as to give businesses enough time to consolidate before the loan payment will commence.
On his part, John Yusuf, Director General, Benin Chamber of Commerce, Industry, Mines and Agriculture (BENCCIMA), said to avoid giving money to the wrong persons, the presidency should involve the organized private sector so that each of the organisations will, in turn, identify the manufacturers and MSME operators.
“Bringing N75bn and N125bn for manufacturers and MSMEs, respectively, the organized private sector should be part of the implementation. Who are the people in manufacturing? Who are the people in MSMEs? The proper MSME people should be identified, the proper manufacturing companies should be identified.
“They should be properly identified so that this money can get to them directly. We have had cases where fertilizers were provided for farmers and the farmers did not get the fertilizers because those political farmers received the fertilizers. There could also be political manufacturers and MSMEs,” Yusuf advised.