GOODLUCK TO SMALL BUSINESS IN NIGERIA

Ifeoma Areh

In the build up to the inauguration that takes place on the 29^th of May, an air of expectancy appears to loom over the heads of the teeming population that participated in the recently concluded general elections. Of this mass of adult voters, a significant percentage are entrepreneurs and business owners. With the victory of incumbent president Goodluck Jonathan at the presidential polls, economic analysts and average Nigerians are curious about the effects of ‘Goodluck’ on businesses in Nigeria and the economy as a whole. However as successful entrepreneurs and motivational speakers will tell you, “luck has nothing to do with it.”

The National Economic Management Team [NEMT] in early April organized a presidential summit on job creation. Issues discussed included Small and growing businesses and enterprises, vocational education, public work and local content development and innovation amongst others. The president promised a full turn around for small businesses in Nigeria with the agricultural and manufacturing sector pushed to achieve a boost in local production and export of commodities. These commodities they say include refined petroleum products, rice, fertilizer and palm oil and other products. Critics however argue that there is nothing new about the government stand on small business and wealth creation, identifying it as another strategy to gain increased approval from Nigerian business owners.

It appears however that this time the government actually means business, with introduction of the 200 billion naira intervention fund for small and medium scale enterprises, Goodluck Jonathan’s scheme for entrepreneurs is receiving a lot of praise. With this development, inaccessibility to credit facilities appears to be on the way out. Manufacturers in the country have applauded the longer time frame and lower interest rate which comes to about seven percent. However structural shortcomings limit this fund according to analysts as businesses need more than funds to thrive.

The government seems to have an answer to this in the form of a training programme for small and growing businesses in Nigeria. In partnership with the Entrepreneurial Development Centre [EDC], the federal government is nurturing 1000 bankable businesses that will benefit from the intervention fund by December 2011. This is a vital step towards developing strong businesses in Nigeria and has been lauded by experts and analysts as crucial in ensuring that the funds that will be pumped into small businesses will be sustainable.

These steps though significant will not bring about long lasting development in enterprise in the nation. This is because infrastructural development remains the bane of small and growing businesses in Nigeria. A basic infrastructural foundation is required to ensure that small and growing businesses not only survive but thrive. Without the needed infrastructure, Nigerian SME’s will continue to take an unsteady walk on the edge of disaster.

Power or electricity is indispensable to growing businesses in Nigeria; President Jonathan has set in motion a road map to efficient power supply in the country. A year later, the stated goal has not been achieved but the government continues to reiterate its commitment towards guaranteeing stable and sufficient power supply in the country. This is requisite for any business to gain meaningful profit as recent research shows that Nigerian businesses spend a daunting forty percent of profits on alternative power supply. Experts also decry the total dependence on gas for power supply and advocate for an inclusion of other sources of energy.

A strategic fiscal policy is essential to the growth and sustainability of enterprise in Nigeria. Unfortunately, shaky and inconsistent policies continue to dog the existence of SME’s in Nigeria. The president has promised stable and efficient policies to boost the manufacturing and agricultural sectors of the economy. Good news for those in these sectors. Experts however argue that the country’s budget favours recurrent expenditure. Take for instance the 2011 budget branded ‘unimplementable’ by finance minister Olusegun Aganga; with a public investment of less than two percent of GDP as opposed to the advised twenty five percent, the Goodluck Jonathan team appears to flounder on this score. Fortunately, the National Assembly which passed the criticized budget has agreed to an amendment.

With an unenviable reputation and top rankings in global corruption ratings, foreign investors constantly lament the lack of transparency in the Nigerian system. President Jonathan swears that the fight against corruption is waxing stronger with the exploits of agencies such as the Economic and Financial Crimes Commission [ EFCC] and the Independent Corrupt Practices Commission [ICPC]. The president paints an irresistible picture of accountability and merit in business practices in Nigeria’s future.

Undoubtedly, there are different plans in different stages of implementation. The initiatives of President Jonathan have been generally commended as a step in the right direction for entrepreneurship and business in the country. However, critics are quick to point out foundational defects and previous plans that were not completed or never saw the light of day due to corruption and or indiscipline. As the new dispensation arrives, we can only wish Good luck to your business; and we mean it, literally and figuratively.