Challenges before Nigerian entrepreneurs

Nigerian entrepreneurs have lamented that the country’s system is stifling their survival.

Challenges before the country’s entrepreneurs include lack of infrastructure which include power, roads, water, etc, multiple tax levies, lack of access to funding, gender inequality, and most recently, recession, among others.

Several entrepreneurs, who spoke with Entrepreneurship+ in the course of two weeks, said that it seemed that there “is a conspiracy against our survival,” some entrepreneurs who didn’t their names in print said last week

Two weeks ago, Babatunde Ogunyemi, CEO, Thelma Farms Ltd, in Ijebu Ode, Ogun State, said the government needs to create a conducive environment for business growth in the country.

“We need the government to intervene and step up these prospects, empower farmers that are actually involved in exportation. We need to ramp up capacities. Small countries like Ghana has gotten it right, Ghana is our main competitor in Europe. The government must ensure that there’s an enabling environment,” he said.

Grace Shobayo, an entrepreneur from Jos, in an email, said the acclaimed provision of access to funding by the Central Bank of Nigeria (CBN), was only a hype on paper, as demands required to be met in order to access loans from country’s commercial banks were daunting.

The banks “were all requesting for collateral I cannot provide and six months transaction with the bank. I told them the purpose of the funds and how urgently it is needed but they will not listen to all my stories. In the course of this search, I wrote to BOI and they also gave their requirement that I am not sure anyone can meet.

“I tell you that all that CBN is saying are just in papers because the commercial banks that are saddled with these responsibilities will create bottlenecks that will make the facilities inaccessible to MSMEs. I sincerely wish that CBN will take it upon itself to handle the program without involving the commercial and microfinance banks,” she said.

Chairman of Heirs Holding, UBA Group and Tony Elumelu Foundation (TEF), which launched the $100 million Tony Elumelu Entrepreneurship Programme (TEEP), Tony Elumelu, who has been canvassing for conducive business environment at every given opportunity, recently noted that one of the challenges before Nigerian entrepreneurs are “obsolete laws.”

In March this year, Elumelu called for review of laws fundamental to the survival of Micro, Small and Medium Enterprises (MSMEs), saying it would go a long way in creating job opportunities for the teeming unemployed Nigerians.

“Instead of addressing the symptoms, let us address the fundamentals. Let us hold our National Assembly members accountable; let us knock on their door. They must sit down and pass bills; we need them to pass one bill per week.

“We cannot afford to meet one hour a day and adjourn; we should sit down and pass bills. You can imagine what this country will become if we have these proper laws in place, we will not be thinking of oil again,” Elumelu said.

Prior to the announcement that the country was in recession, some entrepreneurs lamented the impact of high inflation rates on their business.

However, as country’s economy shrunk by two per cent as announced by the National Bureau of Statistics on Wednesday, August 31, 206, entrepreneurs are worried that many of them may have to close shops.

It will be recalled that the Nigerian Tribune had reported that more than one million people had lost their jobs in three months, while the  Vice Chairman of the Manufacturing Association of Nigeria (MAN), Dr Stella Okoli lamented that several entrepreneurs in that sectors had closed down their business in large numbers.

According to NBS, Nigeria’s GDP shrank by 2.06 per cent year-on-year in the second quarter of 2016, compared to a 0.36 per cent contraction in the previous period and below consensus of 1.5 per cent decline.

“Generally, cost of generating service has increased due to the galloping inflation; also the same affects service buyers as they can’t afford luxury anymore thereby reducing patronage,” Jide Oguntokun, an estate letting/leasing business owner said last week Wednesday.

Entrepreneurs in the agric sector have also lamented that their cost of production is higher now, and since access to funds was minimal, many of them are reconsidering going into business in the next farming season.

Miftah Adediran, CEO of Herlow Rudyns Farm, in Oyo State, said: “As with other sector of the economy, we depend so much on diesel to run the farm. We use diesel for tractors and bulldozer for land clearing. Diesel prices rose from N140 to N200/litre. The marketers are claiming they are sourcing for forex at a very high rate hence the increment in pump price of diesel, a development that is affecting our production costs,” he said.

As Elumelu noted, non-access to credit facilities as well as difficulty in acquiring land are some of the major problems faced by MSMEs, suggesting that a review of the Land Use Act to make it easier for entrepreneurs to acquire land for their businesses.

According to him, the review of the Privatisation Act and other relevant laws could change the economic trajectory of the country, if they were passed on time.

Basically, as the country tries to figure out how to get out of recession, entrepreneurs have once again called to an enabling environment that would help them grow and help the country’s economy.

As figures have shown, small businesses are the backbone of countries’ economies. A 2012 Enterprise Baseline Survey revealed that there are 17 million SMEs in Nigeria, employing 32.41 million persons and makes a contribution of about 46.54 per cent to the nation’s Gross Domestic Product (GDP) in nominal terms.

It is, therefore, important that the government empowered the SMEs sector for optimal outputs.

“The way to go is to create the enabling environment that would unleash the entrepreneurship in all of us. If a man who is interested in fishing for instance, has access to finance, conducive environment to register the business immediately, and tax duplication is avoided, he will be able to employ people,” Elumelu charged.