The year 2020, we all know, was a tough one, especially for operators of Small and Medium Enterprises (SMEs) whose efforts were good though, but not enough to break the barriers set by natural and man-made occurrences like the COVID-19 pandemic and EndSARS protests, among others.
Necessity, they say, is the mother of invention. Buoyed by this saying, many innovative companies shifted their businesses to e-commerce in a bid to break through. Some others shut down completely, waiting for the time when people would be free to open their shops and offices to customers.
Although the year has gone with its challenges, The Tide senior correspondent, Lilian Peters, when to town to feel the pulse of some entrepreneurs on what 2021 holds for the SMEs. Below is their responses.
Managing Director of A.M.C Global, Mr. Tony Onwubiko, who deals on wholesale oil lubricants and parts in Igwuruta said, “My business in 2020 was beyond description. There was total restriction, no import, no export or inter state trade. It was terrible. And of course, this led to my inability to meet my 2020 economic target and even my family financial needs.
Onwubiko expressed optimism that 2021 would be better, saying that he decided to push ahead since his responsibilities as a man increase on daily basis, not minding the circumstances surrounding him as an entrepreneur
He said there was the need for the three tiers of government to assist entrepreneurs in the country.
“During the Coronavirus pandemic (first phase), most SME operators used their capital to keep body and soul together which was not even enough anyway.
“Most entrepreneurs cannot afford the capital requirements of their businesses. I heard and read on pages of newspapers about government and politicians’ palliatives, but majority of Nigerians didn’t receive or get anything. Please, our government should make credit facilities accessible to entrepreneurs.
“Personally, I have found it very difficult to restart my business and bring it back to the level it was before COVID-19. We truly need government assistance now”, he said.
Onwubiko stated that multiple steams of income had always been an answer to business sustainability which, according to him, also falls back to starting capital.
”As for me, I have decided to diversify my business in 2021 by being involved in e-commerce and multi-level marketing which COVID-19 can’t affect. Although the capital to start is still giving me headache but where there is a will, there is always a way”, Onwubiko said.
In the same vein, the Chief Executive Officer, Alpha & Omega Oil & Gas Resources Int’L Ltd, Tamara Richard, said 2020 was indeed a very challenging year for her business.
“The year came with the dreaded COVID-19 pandemic, coupled with the harsh economic situation in Nigeria.
This, she said, brought untold hardships to many business owners.
According to her, “The business terrain in Nigeria was adversely affected by quite a number of factors besides the pandemic. These range from lack of business fund to hyper inflation, poor electricity supply, bad government policies that hamper the smooth flow of goods and services within and across borders.
“I have set some skeletal goals in one or two areas I intend venturing into this year, though not encompassing, because I planned to be very intense in one or two chosen paths. I will visit the goals again to make them clearer and achievable”.
Richard said she was driven by passion and strong instinct to succeed, saying “the setbacks and challenges cannot deter me because I target becoming a phenomenal woman in the business world, obstacles and difficulties, notwithstanding.
“Government should encourage SMEs with good enabling business environment devoid of security challenges. The leaders should also create checks and balance security operations, provide infrastructural facilities, organise business empowerment seminars, give soft loans and grants to financially empower entrepreneurs.
It (government) should review SME operational policies from time to time to measure the workability of such policies to see if they produce the expected result”.
Richard, who described herself as an advocate of diversification said, “I am not only encouraging multiple streams of income, but I am diving into it. Creating multiple streams to me, is the crux of economic stability and sustainability. With the recent happenings in Nigeria and the world at large, it is evidently clear that one stream would not survive any SME”.
To the Chief Executive Officer of Olu P Creative Home, Mrs Oluchi Peter, “My business in 2020 was not that successful because of the pandemic and lack of finance, coupled with other issues in the country”.
Mrs Peter said SMEs seriously suffered setbacks last year, leading to the closure of some businesses that could not manage the situation.
“The New Year comes with new zeal and hope which propelled me to list out my targets as well as drawing the plans on how to achieve success in 2021. The best thing to do is to critically look at the area I did not do well and what went wrong. This analysis is what has helped me in drawing my New Year resolutions.
“Most of the SMEs face financial setbacks and lack of publicity. I think that government should create a platform that would be able to make loan available for enterprises and also create publicity for us.
Peter, who deals on wholesale and retail lace materials, also noted that gone are the days when SMEs depended on single source of income.
“Mutilple streams of income is where survival is, especially in the harsh economic situation in Nigeria. An individual needs to have different sources of income just in case one fails; he or she will still be financially stable and can live comfortably.
“One of my major plans for the year is to launch fully into e-commerce and explore the benefits provided by the use of the internet to grow my business in 2021”, he said.
Inflation: Uwaleke Tasks CBN On Agric Interventions
The Association of Capital Market Academics of Nigeria (ACMAN) has urged the Central Bank of Nigeria (CBN) to scale up interventions in agricilture sector to stem the rising inflation figure.
ACMAN President, Prof. Uche Uwaleke, said this in an interview with newsmen yesterday, while reacting to the January inflation figure released by the National Bureau of Statistics (NBS).
The Consumer Price Index report released by the NBS said the nation’s headline inflation rose by 0.71 basis points in January to 16.47 per cent from 15.75 per cent recorded in December.
According to the report, Nigeria’s headline inflation has risen to its highest in over three years, while food inflation rose to its highest since July 2008, when it stood at 20.9 per cent.
On a month-on-month basis, the headline index increased by 1.49 per cent in January 2021. This is 0.12 per cent points lower than the rate recorded in December 2020 (1.61 per cent).
Uwaleke said the Federal government and the CBN should scale up interventions in agriculture.
He observed that the inflationary pressure had refused to abate in spite of the reopening of the border and reduction in levy on imported cars.
“Inflationary pressure is coming more from the food component which has now exceeded 20 per cent.
“This reflects the lingering effects of increases in Value Added Tax, pump price of fuel and electricity tariffs as well as insecurity and transport bottlenecks,” Uwaleke said.
He added that the CBN should equally consider increasing foreign exchange supply to bring down exchange rate, especially now that crude oil prices are relatively high.
According to him, the new Service Chiefs should roll up their sleeves and confront the seemingly intractable insecurity challenge in the country.
Bank Issues N41bn Local Bond To Support SMEs, Businesses
Tier 2 lender, Fidelity Bank, says it has completed the issuance of a fixed rate unsecured bond of N41.21 billion with a tenor of 10 years at an 8.5 per cent coupon rate.
The transaction, which was executed under its registered N100 billion bond issuance programme, will mature in 2031, a document showed.
Given its nature as a subordinated debt, the bond ranks beneath other, more senior loans or instruments with regard to claims on assets or earnings. It means creditors in possession of this kind of security will not be paid out unless senior bondholders are fully paid in the event of a default.
The bank said the debt-raising was 137 per cent subscribed as total investor interest and commitment came to N56.6 billion, affirming the bank’s “capacity to successfully execute debt capital market transactions.”
According to Fidelity Bank, “the transaction is a landmark achievement in the Nigerian domestic debt market for being the largest corporate bonds ever issued by a Nigerian Bank including the deposit money banks and merchant banks etc.”
Lagos-based Fidelity Bank in December declared its aspiration to issue fixed income securities of a 10-year tenor to support Small and Medium-sized Enterprises (SMEs), retail business and technology infrastructure.
The bond “validates the continued investor confi-dence in our corporate strategy and aspirations, strong corporate governance structure and solid and stable executive management team with robust history of superior financial performance and returns,” said Fidelity Bank Chair Mustapha Chike-Obi.
Fidelity bank’s chief execu-tive, Nneka Onyeali-Ikpe,said the decision to commit the proceeds of the transaction to the develo-pment of SMEs, retail business and technology infrastructure aligned with the lender’s Tier I ambition.
“The successful bond issuance highlights the confidence in the Fidelity brand, as well as our capability to expand our funding sources, and deliver innovative financial services to our esteemed customers,” she added.
Kebbi Rolls Out Programmes To Improve Socio-Economic Wellbeing
Kebbi State Government has rolled out strategies and programmes to improve the socio-economic wellbeing of youths in the state.
The government stated that, it would provide enough information for the teaming youths to tap various grants, empowerment, agriculture loan’s opportunities by international groups, Central Bank of Nigeria (CBN) and other donors for their progress.
The Commissioner for Youths and Sports Development in the state, Alhaji Gidado Kaliyal, who stated this while addressing various youth groups on mutual dialogue, held at the conference room of the Ministry of Budget and Economic Development, along other cabinet members of state executive council, reassured the youths that the current administration would do everything to strengthen their capacity as productive members of the society.
The Commissioner for Information Communication Technology, ICT, Alhaji Abdullahi Muhammad Magoro, Commissioner for Information and Culture, Alhaji Mahmud Warrah, Majority Leader, Kebbi State House of Assembly, Alhaji Faruq Aliyu Nasarawa and the Chairman of Jega LGA, Alhaji Shehu Mashal, who double as the state ALGON Chairman as well as the Deputy National President of ALGON were among those who witnessed the interactions session.
The Commissioner for Youths and Sports Development, while addressing the youths, said, “the state government has the confidence about the ability of youths to become vanguards of development of the society. The state government will make enough opportunities available and other organisations for the youths to utilise, for economic prosperity”.
The Special Adviser to the Governor on Media, Yahaya Sarki, in his short remarks advocated for greater synergy between the CBN, NIRSAL, the Donor Agencies and the Ministry of Information and the Press, for the creation of awareness on the availability of the various FGN interventions for the youths.
In his paper presentation, Dr Usman Buhari Gwandu, enumerated numerous grants and loan schemes in Nigeria, Africa and at the global levels which youths and women could access, to attain self employment.
A Representative of Small and Medium Scale Enterprises, SME, Alhaji Nasiru Bello, lamented the high rate of unemployment among the youths, especially graduates of Universities and Polytechnics.
He disclosed that President Muhammadu Buhari has set aside N75 billion for the youths to access through the SME, to start businesses of their own.
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