Business magnate, Folorunso Alakija has charged President Muhammadu Buhari to prevail on banks in the country to reduce their stringent requirements in order to support and enable Small and Medium Enterprises (SMEs) to thrive and contribute to the economy.
Alakija, who is one of Africa’s most influential women, made this charge as a guest on CNN’s One World with Zain Asher, where she discussed the African economy and how Nigeria as Africa’s engine room could diversify its economy to the benefit of the growing population.
Maintaining that the government has an important role for SMEs to thrive, Alakija said: “The government has a big role to play; get banks to reduce the usually stringent requirements for SMEs, and interest rates need to be lowered.
“The government also needs to improve the quality of infrastructure; infrastructure is an area that is causing problems and it has negative impacts on SMEs in the country.”
Why the charge by Alakija on SMEs matters
It is an open secret that SMEs account for the majority of businesses around the world, and are important contributors to job creation and economic development. For instance, in Nigeria, according to PwC, SMEs contribute 48% of national Gross Domestic Product (GDP), account for 96% of businesses, and 84% of employment.
However, despite the significant contribution of SMEs to the Nigerian economy, operators in the sector experience various challenges that hinder their growth. The most common, among the challenges they face, is access to finance.
Should Buhari put more priority on SMEs in Nigeria as suggested by the billionaire, the sector will grow, and consequently, it will improve the economy.
