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SMEDAN Calls for Stakeholder Support to Drive MSMEs Growth

The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) has urged stakeholders to join forces in bolstering the competitiveness of the Micro, Small and Medium Enterprises (MSMEs) sector.

Dr. Olawale Fasanya, the Director-General of SMEDAN, made this appeal during a press briefing in Abuja on Monday, commemorating the 2023 World MSMEs Day with the theme “Building a Stronger Future Together.”

The United Nations General Assembly designated June 27 as Micro, Small and Medium-sized Enterprises Day each year.

Fasanya highlighted the significant contributions of MSMEs to Nigeria’s employment and Gross Domestic Product (GDP) based on the last survey conducted jointly by the National Bureau of Statistics (NBS) and SMEDAN in 2020.

“MSMEs accounted for 46.31 percent of the GDP and over 84 percent of total employment,” he stated.

Fasanya emphasized that both government and the private sector must extend support to foster the growth of the MSMEs sector. He expressed concern over the sector’s meager contribution of 6.21 percent to Nigeria’s total export basket, stating that it is notably low compared to other emerging economies.

“This suggests that our MSMEs lack global competitiveness, necessitating a change in the narrative, especially in light of the anticipated impact of fuel subsidy removal on the sub-sector,” Fasanya added.

While anticipating concerted support from key stakeholders, SMEDAN is implementing various support systems to propel the development of MSMEs. These interventions encompass capacity building, advocacy, access to finance, technology, markets, raw materials, data, and the establishment of appropriate policy frameworks.

Fasanya revealed that SMEDAN has been engaging in sustained advocacy visits to public and private funding organizations to facilitate easier access to loans for MSMEs. To address funding challenges, the agency initiated programs with funding components.

One such program is the Conditional Grant Scheme (CGS), aimed at reducing the size of informal nano and micro-enterprises, which the NBS report estimated at over 38 million. Since its inception in 2017, the CGS has benefited over 75,000 beneficiaries across states.

To overcome challenges in sourcing funds, equipment, workspace, power, and other requirements for expansion or start-ups, SMEDAN has employed the Common Facility Center (CFC) model. The agency has established CFCs in Abuja (Garment, Furniture, and Products Packaging), Katsina (Garment), Kaduna and Nnewi (Automotive Component Production), and Ikorodu (FMCG Packaging).

Fasanya stressed the need for collaboration between public and private stakeholders to replicate the CFCs nationwide, enabling MSMEs to seize opportunities in the global market, particularly under the AfCFTA initiative.

He also highlighted the National Business Skills Development Initiative (NBSDI), which provides entrepreneurship skills, vocational training, and starter packs. The NBSDI has benefitted over 25,000 micro-entrepreneurs and generated over 50,000 indirect jobs since 2019, according to the agency’s Annual Impact Assessment report.

Furthermore, SMEDAN’s One-Local-Government-One-Product (OLOP) program, implemented in 109 senatorial districts, has empowered 774 cooperatives in each of the 774 LGAs, benefiting over 80,000 indirect beneficiaries.

To bridge the funding gap in the MSME community, estimated at over $158 billion, SMEDAN launched the Matching Fund. This intervention offers credit to enhance enterprise output, competitiveness, and job creation. Prospective beneficiaries can access loans ranging from N500,000 to N2.5 million, and the agency seeks partnerships to expand the reach of this initiative.

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