‘Gap between SMEs and large enterprises creates process inefficiency’

Tony Ejinkonye is the president of Abuja Chamber of Commerce and Industry (ACCI). In this interview with HARRISON EDEH, he outlines measures that should be taken by governments at all levels to spike the growth of small businesses. Ejinkonye also speaks on opportunities created by the Economic Growth and Recovery Plan (EGRP).
The SMEs are building blocks of every economy. How do you assess their performance so far in terms of contribution to the economy?

The small- and medium-scale enterprises (SMEs) contribute nearly half of the Nigerian GDP and contribute significantly to jobs created in the economy.
There are 37 million SMEs in Nigeria, contributing about 47 percent to the nation’s Gross Domestic Product in nominal terms.

SMEs play a major role in Nigeria’s economy in terms of job creation and income distribution.
The future of Nigeria lies more on the SMEs because they contribute more in terms of investments. Reports indicate that in Nigeria today, 65-70 percent of the workforce is in the SMEs category.
Do you think government interventions for SMEs are enough to spike growth of the sector?
Government interventions for SMEs are insufficient to drive economic growth. The concept of SMEs is being misconstrued in Nigeria. SMEs are supposed to be a means and not an end in the production process. SMEs are to feed the big manufacturers/producers/processors but the widening gap between the SMEs and processors in Nigeria is creating process inefficiency.
Government should facilitate and/or create and engagement framework that will bring SMEs and big processors together in mutual economic activities.
Could you share your thoughts on how Nigeria can speed up economic recovery?
There should be commitment to priority projects in the Economic Recovery and Growth Plan (ERGP), in particular physical infrastructure and social infrastructure.
While physical infrastructure will reduce the direct cost of doing business, investment in social infrastructure will foster peace and integration that will equally make the business environment conducive. One critical enabler of growth is investment (foreign or local), hence, to consolidate the recovery, we must facilitate investment.
The economic growth rate of 0.55 percent is still fragile. How do we expand opportunities of job creation using the opportunities in the ERGP?

Job creation opportunity can be done either in the short, medium, or long term. There are low hanging job opportunities in the agriculture value- chain. Also, improved security across the country will encourage higher cultivation as well as increase complementary activities. The synchronisation of macroeconomic policy (fiscal, monetary and trade) will open up the window of opportunities in the medium-to-long term.
You need huge investment (local, FDI and FPI) to expand scope for job creation. Government is holding onto too many items it neither has the finance nor the capacity to implement. I want to suggest the public-private partnership model in financing infrastructure. Nigeria needs to spend at least N30 trillion annually on infrastructure for the next 30 years while the 2017 total expenditure by both the federal and the state governments is about N13 trillion. So it is simple logic, open up for private participation to achieve scale and efficiency.

The World Bank and other international bodies have lauded Nigeria’s initiative in the ERGP, but stakeholders have concerns with ‎slow implementation of the Plan. Let us have your thoughts on this?
The Plan addresses economic challenges confronting Nigeria but until we have clear/measurable milestones and realistic timelines, its implementation will be subjected to the whims and caprices of public/civil servants.