New Telegraph

Boosting MDAs’ support for MSMEs

Following the numerous complaints by micro, small, and medium enterprises (MSMEs), local manufacturers and the business community about the inhibiting activities of ministries, departments and agencies (MDAs) of government, the Vice President, Prof. Yemi Osinbajo, has waded in, saying MDAs must support them, TAIWO HASSAN reports

Indeed, entrepreneurs are important to the growth and development of the Nigerian economy in all ramifications as they play important role in job creation and driving social inclusion in the country. However, efforts to strengthen their contribution needs to be prioritised by the relevant stakeholders, including the relevant ministries, departments, and agencies (MDAs) of government by creating a conducive and enabling business environment for them to thrive. No doubt, the state of entrepreneurship in Nigeria is in a mess concerning the various macroeconomic challenges confronting businesses in the country, resulting to both big and small business owners weathering the storms to remain in active businesses. Nevertheless, business owners, who are resilient, dynamic and are known to forge through amidst severe challenges in the business environment, are in dilemma over negative treatments meted out by relevant MDAs of Government to them.

Multiple regulations by MDAs

Over the years, there have been complaints from MSMEs, local manufacturers and business community operators in all facet of Nigeria’s key economy, notably, the private sector. However, so worrisome is the fact that despite the worsening economy hitting many key sectors, MDAs are not allowing firms operate freely as they come up with harsh and multiple taxes among others. These inappropriate charges, one way or the other, have been hindered growth and development in the country’s manufacturing sector and other concerned sectors. While speaking on the activities of the MDAs, the Manufacturers Association of Nigeria (MAN)’s President, Mansur Ahmed, disclosed that despite government’s commitment to the revival of the country’s industrial sector to attain optimum growth in value chain, it is shocking that agencies of government are frustrating local manufacturers from making headway and achieving sustainable productivity. The MAN president explained that often times agencies of the federal, state and local authorities regulate the same manufacturing process resulting in man-hour losses, supervisory duplication using similar checklist and multiple regulatory charges, which often culminates in increased overheads for manufacturers.

MSMEs’ contribution to GDP

There is no gainsaying that the country’s MSME sector plays a key role in the economy. The sector is the backbone of major development economies, and in Nigeria, MSMEs contribute 48 per cent of national gross domestic product. They account for 96 per cent of businesses and 84 per cent of employment. According to the statistics from the National Bureau of Statistics, they also account for 50 per cent of industrial jobs and 90 per cent of the manufacturing sector in terms of numbers of enterprises. And from SMEDAN’s survey done in 2017, there are estimated 41.5 million MSMEs in Nigeria. Interestingly, 10 per cent of these are in Lagos. However, unfriendly business environment, the most critical infrastructures that is needed to drive economy, is conspicuously absent.

Harsh business constraints

On this matter, we have to put the blame on the doorstep of the Federal Government over its inability to address the alarming bottlenecks facing Nigerian businesses all this while. A business owner, in a chat with this newspaper, said: “I want to tell you categorically that no investor will like to invest his hard earned money in an unconducive business environment like Nigeria, which is not stable both politically and economically. “Indeed, our government should expect more foreign firms in the world to boycott Nigeria until we are ready to address the lacuna hindering ease of doing business and investors to guarantee high returns of investment in their established businesses.”

FG’s intervention

Indeed, the Vice President, Yemi Osinbajo, had asked relevant MDAs to support the “hustle” of Nigerians. At the yearly review of how Federal Government agencies relate with micro, small, and medium enterprises in the country, the vice president asserted that one critical role of the MDAs was to create a conducive and enabling business environment for the citizens. Osinbajo made this assertion during the MSME Clinics Stakeholders’ review meeting at the Presidential Villa in Abuja recently, which was attended by heads and representatives of agencies including SMEDAN, BOI, NEXIM BOA, SON, FIRS, NAFDAC, and others. He said: “Everybody knows that Nigerians are enterprising. Practically, every Nigerian has some kind of business, as they say, some hustle or some other things that they are doing. “People need the right environment and that is what our role is, to ensure that we understand that it is to facilitate and make it easier, not to become a stumbling block or a tollgate.” He also made the point about the hardworking nature of the average Nigerian, noting that “this is a country where people want and desire to work,” but added that ‘the constraints are what we have to address. This would be dealt with by human beings and not spirits.”

Addressing challenges

In addressing the challenges, the VP mentioned that “our creativity and innovation must be first and foremost to remove the obstacles, that is what will solve Nigeria’s problems, implementation of the grand policies that we have and it depends on us.”

Business registration woes

The VP spoke about how it has taken some young Nigerians three years to get registration numbers for their businesses. He said he was told that in some other close African nations, the same registration takes six weeks. He said: “If you get food and drugs administration registration anywhere else, you can be in a Nigerian supermarket… and they come and compete with our own people here. This is happening in every respect, even with exports.” In her remarks, the Minister of State for Industry, Trade and Investment, Amb. Mariam Katagun, expressed her appreciation to the Vice President for his leadership role, and also praised the stakeholders and State governors for their collaboration and cooperation in holding MSME Clinics.

Last line

Notwithstanding this positive drive, government must intensify efforts to improve the operating environment for Nigerian businesses by addressing core traditional and non-traditional issues such as limited access to finance, inadequate infrastructure, insecurity and MDAs’ harsh regulations. These are the main obstacles facing entrepreneurs in Nigeria today.

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