The owners of Small and Medium Enterprises (SMEs), under the auspices of the Association of small business owners of Nigeria (ASBON) stated that the perfomance index of Micro, Small and Medium Enterprises (MSMEs) have been depleted by prohibitive cost, energy cost, high inflationary environment, forex constraints, shortage of raw materials, dearth and scarcity of manpower resources, among others.
The president, ASBON, Dr. Femi Egbesola, disclosed that MSMEs in the country had lost hope and confidence levels in the ease of doing business, adding that, businesses are beginning to divest out of the country due to the astronomical rate of inflation mounting on small businesses and household income.
The group also lamented the dearth in investment capital and investment income which, they said, were largely to blame for the sector’s stagnation, coupled with challenges such as; poor infrastructure, inconsistent government policies, double taxation, regulation irregularities, among others.
The operators noted that most businesses have great potential for growth but for the challenge of finance.
ASBON, who said, funding is the bloodline of any business, whether it is a startup, nano, micro, small or medium-sized business, added that, the high operating cost in the country has worsened the case of businesses that lack funds due to the process of accessing it and high interest rates.
The stakeholders advocated the need for government to support businesses by providing financial support for survival in the current high operating cost.
ASBON boss averred that, funding is beyond the reach of small business owners, because banks have not been duly standardised to the point of accommodating the documentation processes of small businesses.
On his part, the chairman, SMEs Group, the Lagos Chamber of Commerce and Industry (LCCI),D aniel Dickson-Okezie, said though government has made efforts to improve the real sector through funding, more needs to be done.
He noted that corruption in the system was hindering those who actually need these funds from accessing them.
“Despite government’s statements on improving the real sector through funding, it’s not still enough. Corruption in the system has put a setback on the initiative. Most times, those funds don’t get to the right persons. They end up in the hands of the wrong people,” he said.
Managing director, Goshen-Multi Nigeria Ltd and immediate past chairman of the National Association of Small Scale Industrialists (NASSI), Kuti George, stated that, loan facilities were not accessible, adding that the Central Bank of Nigeria (CBN) needs to make access to funding easy.
“The country needs to build industries, when the nation is industrialised, it will boost the economy. Government needs to encourage production and manufacturing by funding them. Most people have ideas but don’t have the funds to produce and increase value. MSMEs need access to cheap funds.
“The government says there are a lot of windows to access loans but these windows are not actually accessible. The loan facilities are not accessible. The CBN needs to facilitate easy access to loans.”
Kuti-George identified inability to acquire modern equipment to meet up with global standard of production as another challenge facing the MSMEs sector, urging government to assist them in purchasing modern equipment as many could not afford these machines due to high cost.
On his part, the managing director, Aarti Steel Nig Ltd, Imokhai Ehimigbai, who is also a member of Manufacturers Association of Nigeria, Export Group (MANEG), stressed that, lack of funds is a serious challenge to adding value to its export proceeds.
“Capital is expensive in Nigeria. Businesses find it difficult to get money for machines to process the raw products. You need capital to buy machines. Even when the capital is there, the gestation period is very short. Interest rate is very high,” he pointed out.
Similarly, the chief executive officer (CEO) of Sourcing and Producing, an agricultural trading company, Lanre Awojoodu, urged the federal government to support Nigerian exporters with loans to encourage them in the regulated global commodity platform. Awojoodu said, export companies need capital which would enable them to compete globally.
