Small, medium enterprises account for 84 per cent of jobs in Nigeria

Nigeria’s over 37.07 million micro, small and medium-scale enterprises, MSMEs, account for more than 84 per cent jobs in the country, the Ministry of Industry, Trade and Investment has said.

This was part of the presentation on energizing the MSMEs sector as a major economic growth driver at the National Economic Council, NEC, meeting in Abuja presided by the Vice President, Yemi Osinbajo.

Besides, the ministry said the enterprises also account for about 48.5 per cent of the gross domestic product, GDP, as well as about 7.27 per cent of goods and services exported out of the country.

Of the total number, micro enterprises account for the bulk of the MSMEs in Nigeria, with 36,994,578 enterprises (about 99.8 per cent), while small enterprises took 68,168, and medium enterprises 4,670.

The presentation credited Lagos State with the highest number of micro enterprises (3,224,324); followed by Oyo and Kano States (1,864,054 and 1,794,358 respectively), while Nasarawa State had the least (226).

In his presentation on financing opportunities critical for development of MSMES, the governor of Central Bank of Nigeria, CBN, Godwin Emefiele, gave reasons why the bank was involved.

Mr. Emefiele said it was to increase lending, provide access to affordable credit facility, and diversify the country’s economic base, create jobs and improve micro-economic stability.

Other reasons included to boost the capacity of MSMEs, conserve foreign exchange reserve, encourage export and the expansion of agriculture, manufacturing and to service other sub-sectors.

He stated that the CBN had a fund for such purposes in excess of N200 billion meant to provide affordable loans to MSMEs.

For instance, the CBN governor said the bank has helped 120, 290 small holder farmers in about three states under the Anchor Borrowers Programme launched by President Muhammadu Buhari, creating more than 500,000 jobs in the process.

In her presentation, Minister of Finance, Kemi Adeosun, reported that as at November 2016, the balance in the Excess Crude Oil Revenue Account stood at about $2.5 billion.

On the update on budget support loan facility to states, Mrs. Adeosun said about N1.1 billion was disbursed to 35 States in October, bringing the total disbursement to each of the 35 States to N6.3 billion.

The minister reported to the Council about long term financial abuses perpetrated by some revenue generating agencies.

Based on previous deliberations on the issue, the Vice President said the federal government was paying closer attention, with a view to curbing the excesses of these agencies.

Asked to further brief the council on the issue, Mrs. Adeosun provided details of certain activities of some of the agencies considered financial abuses of the revenue they generate.

These included deliberate refusal to remit to the Federation Account the revenue they generate and diverting same through various undue and illegal means and ploys.

Some of the affected agencies pay salaries above specifications by the Revenue Mobilization Allocation and Fiscal Commission, RMAFC, convert official cars to personal ownership under 48 hours of purchase, and undertake inappropriate and arbitrary monetization of medical allowances.

Other illegalities include undue and excessive overseas travels, lavish training allowances and conference spendings, excessive and personal loan approvals, including unapproved mortgages, among others.

The minister said her ministry and RMFAC were working together to check these abuses as these revenue agencies raise as much as N1.5 trillion yearly, and spend almost 90 per cent on recurrent expenditure in clear violation of due process and the constitution.

Besides, the minister said the financial abuses have been going on for more than a decade, with agencies hiding revenues they ought to remit to the Federation Account.

The council also received a report on over N2 billion said to have been paid to some states from the Ecological Fund by the last administration under unclear circumstances and criteria.

There were complaints that some state governments did not have equal access to the fund amid allegations of political preferences.

In his response, the Vice President assured the council that the matter would be properly investigated, broadly reviewed, and the president given appropriate advice.

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