Adopt Asian model to grow SMEs, LCCI urges FG
The Lagos Chamber of Commerce and Industry (LCCI) has advised the Federal Government to adopt the model used by the four Asian Tigers to grow the micro, small and medium enterprises (MSMEs).
“It is important to take a cue from the Tiger economies such as Singapore, Taiwan, South Korea and Hong Kong (China) in which concentrated target and support of the government played a crucial role in nurturing local entrepreneurs up to the point of viability and sustainability. SMEs in these countries contribute 78 to 81 percent to the gross domestic product,” said Jon Tudy Kachikwu, chairman of the Small and Medium Enterprises Group (SMEG), at the LCCI SMEG Forum held in Lagos.
“It is imperative to move from mere policy statements and documentations to effective mobilisation of policy actions from the grassroots,” Kachikwu said.
In a paper entitled, ‘Experience of SMEs in South and South-east Asia’, Anil Sinha, general manager, South Asia Enterprise Development Facility, said the ‘Asian Miracle’ was founded on clear government policy for SMEs, and in all cases growth being enabled by outward-oriented industrial policies that featured heavy investment in transport and communications, as well as education and skill training.
Sinha said Taiwan government created an environment where entrepreneurship could flourish, adding that a series of statutes to encourage investment were promulgated, including establishment of industrial parks, creation of geographic and sectoral clusters of SMEs targeting specific industries and encouragement of foreign firms with technology transfer capacity to locate in target industries.
Thirteen-seven million MSMEs in Nigeria contribute 47 percent to the GDP, creating over 25 percent of total jobs. However, poor access to cheap credit, poor business plan and record-keeping, infrastructure hiccups, and regulatory pressure, among others, are their major challenges.
According to Kachikwu, the present government had demonstrated a good level of sensitivity to the plight of small businesses, asking for the sustenance of the efforts.
Nike Akande, president of LCCI, said the government hasdapproved several key initiatives targeted at improving the ease of doing business in the country, calling on small business owners to study the initiatives on improving access to credit, payment of taxes, starting a business, trading across borders and execution of contracts to take advantage of them.
“Government should continue to tackle issues of multiple taxation, inconsistent policies, unfriendly environment and insecurity in the country. For entrepreneurs, I draw your attention to the potential in technology, the social media and smart communication platforms to boost the operations and marketing of our businesses in new age through digitalisation and mobile transactions,” Akande said.
Joy Akinolu, consultant for the Bank of Industry (BoI), advised entrepreneurs to always consider who will buy their products, where they can sell them and the solutions they are meant to provide before setting up businesses.
“Do you provide guarantees to your customers? Hyundai came to the American market and provided them with 100 years warranty. Today, it has taken over. We do not often provide warranties because we sell substandard products,” Akinolu said, advising small businesses to stop creating awareness but focus on persuasion.
Yusuf Bashir, comptroller of Tin Can Island Command of the Nigeria Customs Service, said it was time for Nigeria to invest in electronic processes, calling on regulatory agencies to have a common technology pot where information could be sourced.
“If Customs is spending N5 and the Immigration, NAFDAC, SON and other agencies are spending N5 each, we may end up spending N40. But if we bring them to one platform, the cost will be less,” Bashir said, while urging importers to stop doctoring documents while calling for an urgent construction of Apapa and Tin Can roads that laid the golden eggs for the country.
ODINAKA ANUDU