Driving Nigeria’s MSMEs in 2015
Nigeria’s micro, small and medium scale businesses passed through difficult times in 2014. This year, 2015, has provided another opportunity for all stakeholders to make amends and drive this sector, which is key to whatever the country wishes to achieve.
First, stakeholders in 2014 complained bitterly over several harassments by government agencies. The Lagos Chamber of Commerce and Industry (LCCI), in 2014, bemoaned several such harassments of its members by various agencies masquerading as revenue collectors. Stakeholders say governments at all levels must now begin to see themselves as trade promoters rather than mere revenue collectors.
Secondly, credit access to credit has been priced out of MSMEs. Badaru Mohammed Abubakar, national president, Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture( NACCIMA), said lending rates, ranging from 22 to 35 percent, not only cripple MSMEs but also weaken operators in the MSME category that are in the manufacturing sector.
The Central Bank of Nigeria recently raised the Monetary Policy Rate (MPR), which is an interest rate benchmark from 12 to 13 percent, implying that business owners now have to pay more to gain credit access.
In a recent briefing on the state of the nation in Lagos, prepared by Mohammed Badaru Abubakar, president of the chamber, but read by Bassey Edem, deputy national president, NACCIMA said the current lending rate is too high for any productive venture and has significant implication on the global competitiveness of Nigerian firms and their products, stressing that considerations should be given to businesses in this category if the nation is pursuing economic diversification.
Moreover, stakeholders urge improved power supply in the country as MSME operators spend huge sums on money on diesel.
Remi Bello, president, LCCI, confirmed that the power sector privatisation is yet to yield positive results, as businessmen, especially MSMEs, make huge expenditure on diesel and fuel as well as pay outrageous electricity bills for poor service.
Bello who also said that delivery of containers and evacuation of cargo have become a terrifying experience for businesses, resulting in systemic traffic gridlock, paralysis of businesses, high demurrages, frequent accidents and risk to bridges and flyovers.
According to him, the Nigerian economy is still riddled with unfair competitions, arising from unbridled importation of consumer products, granting of underserved waivers to individual firms and evasion of import duty payment.
He said the idea of giving revenue targets to government agencies such as the Nigeria Customs Service (NCS) often leads to unfair taxation and burdens on MSME investors.
“Reports reaching us indicate many instances of upward review of values of import in complete disregard to the values of invoices of such imports,” said Bello in Lagos, while urging a dramatic shift this year.
ODINAKA ANUDU