Osinbajo: MSMEs Key to Economic Growth

Yemi Osinbajo

*Emefiele tasks banks on improved lending to real sector

James Emejo in Abuja

Vice-President Yemi Osinbajo has said that it is no longer possible to achieve a robust growth trajectory as well as realise the much desired inclusive growth without proper attention to the Micro Small and Medium Enterprises (MSMEs) sub-sector of the economy.

He said the sector not only contributes significantly to the economy but also serves as an impetus for economic diversification.

Speaking at the opening of the 11th Annual Banking and Finance Conference, themed: “MSMEs: The Game Changer for Economic Growth and Development”, in Abuja Tuesday, the vice-president, who was represented by the Secretary to the Government of the Federation (SGF), Mr. Boss Mustapha, added that government is currently working round the clock to put the country in its rightful place in the world economy.

He said this will be achieved through the provision of key physical infrastructure, technology and innovation as well as conducive atmosphere for small businesses to thrive.

He said:”I want to assure the international and local business communities that this administration will continue to provide a more secure business environment and commit more to these ideals in the interest of economic development in Nigeria.

“We shall continue to provide physical infrastructure and make every part of the country attractive to investors.”

He said though achieving the desired friendly business environment is still work in progress, all hands must be on deck to develop it and bring it to the desired level.

However, the Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, challenged the banking industry to complement the bank’s various initiatives aimed at increasing lending to the real sector, especially the MSMEs in the country.

He argued that the CBN has done so much in de-risking the SMEs sub-sector as well as providing funds for on-lending to small businesses, adding that it’s now the turn of banks to complement the CBN’s efforts by improving lending to the MSMEs which is considered as critical to the economic growth diversification agenda of the current administration.

Speaking at the conference, organised by the Chartered Institute of Bankers of Nigeria (CIBN), Emefiele, who was represented by the CBN Deputy Governor, (Economic Policies), Dr. Joseph Nnanna, said: “It’s now left for us the financial intermediaries of the economy to support and complement these efforts.”

He said the over 27 million SMEs across the country could not be ignored if the economy must be diversified.

The governor said the MSMEs continued to face harsh business environment and restricted access to infrastructure as well as apathy on the part of financial intermediaries to lend to the sub-sector.

Nevertheless, he noted that the CBN had designed initiatives to reduce the financing gaps to small businesses and increase access to low cost financing and entrepreneurial capacity.

The CIBN President, Dr. Uche Messiah Olowu, said MSMEs should be the game changer given their potentials and expected contribution in an emerging or developing economy.

But he said the sector is constrained by identified challenges including high taxation among others.

He acknowledged the efforts of government and its agencies in creating special windows towards addressing the challenges faced by MSMEs.

He said a cohesive approach will be required and tough decisions taken to ensure that inherent constraints of the MSMEs sector is properly looked into and all efforts galvanised to addressing them.