Experts identify education, policy, trust as impediments to start-ups, SMEs
Seasoned entrepreneurs and mentors have identified lack of entrepreneurship education, policy misdirection and absence of trust as reasons why Nigerian start-ups and small business owners do not grow as much as they should.
According to these experts, while governments at the three tiers have not done enough to create the right atmosphere that will enable small businesses to thrive, only little effort has been made to increase the skills of budding entrepreneurs.
At the FATE Foundation Dialogue Series held in Lagos, Sarah Alade, deputy governor, economic policy directorate, Central Bank of Nigeria (CBN), said there were yet unused micro, small- and medium-scale funds because banks did not want to take credit risks owing to lack of trust or confidence on borrowers.
Alade admitted that credit to SMEs was still relatively low, pointing out that lending to exporters had been equally poor. She, however, said the CBN had recognised the critical importance of SMEs and was ready to spur this segment of business through commercial agric schemes, entrepreneurship development centres and MSME schemes, among others.
Mudashir Olaitan, director, development finance department, CBN, said there was the need to raise the skills of SME operators while also educating them to understand that entrepreneurship was not a temporary thing.
“Some of our funding areas go through the Bank of Industry (BoI). Just few days ago, we disbursed N1.3 billion through Bank of Agriculture (BoA) to farmers. We want to bring back backward integration so as to stop exporting our jobs,” Olaitan said at the dialogue series entitled, ‘Positioning SMEs for Growth: How to Ensure Nigerian SMEs Thrive Despite Economic Headwinds’.
Friday Okpara, director, strategic partnership, Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), said in spite of all the opportunities in Nigeria, the country had, over the years, been exporting employment while importing unemployment.
Okpara said Nigerian youths thought there were no jobs when opportunities abounded everywhere, regretting that many young people were often reluctant to acquire skills that would enable them to become entrepreneurs.
“We have been trying to push entrepreneurship education in SMEDAN. We work with states to unleash entrepreneurship education. We often emphasise proper book keeping to SMEs. Poor book keeping is often why banks do not like them. We also expose them to the market,” he said.
He stressed that the agency monitored the YouWin project of the immediate past administration in the country, which led to the success of many participating SMEs, while also calling for more funding for SMEDAN to enable it fulfil its mandate.
Gbenga Ashiru, commissioner for commerce and industry, Ogun State, said entrepreneurship education was important now, but he pointed out that poor sustenance of technical training centres around the country was a failure of government.
“We need to rehabilitate training centres. I always believe that government is a continuum. You don’t just come in and kill the good policies of people before you,” he said, adding that banks must endeavour to support this category of business.
Toyin Bakare, executive director, SAS Textiles Limited, said there was a critical need to generate awareness on current government policies.
Bakare said government must reform customs duties, property regulations and business registration guidelines while also investing in power and creating incentives for exporters.
“2015 has been an eventful year. SMEs foster job creation. But we need to be empowered. We need government policies that will genuinely boost SMEs. The number of shops closing down in Nigeria is alarming. We had six textile shops around us before, but we are the only surviving one now,” she said.
“We have to look away from the government because it is not encouraging us. We need to start producing fabrics here. The cost of doing business in Nigeria and the bureaucracy involved in accessing funds from banks are worrisome,” she added.
Bakare, whose business is now second generation, urged SMEs to put their houses in order by creating value, stressing that only entrepreneurship education could guarantee the success of SMEs.
Henrietta Onwuegbuzie, academic director, Owner-Manager Programme, Lagos Business School, who moderated the panel discussion, said there was a need for policy makers to understand that they could not do without entrepreneurship education. Onwuegbuzie, however, wondered why many young Nigeria would be looking for jobs when there were needs everywhere in the country.
“While we complain of unemployment, there are many needs. You will notice that when people need good plumbers or bricklayers, they go and get them from outside this country. Don’t we see this as an opportunity?” she asked.
ODINAKA ANUDU