Anayo Agu: Why Other States Should Adopt Enugu SME Model

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Anayo Agu

By avoiding past mistakes, Enugu State is making steady progress in the promotion of micro, small and medium enterprise (MSME). Special Adviser to the Governor on SME & Investment Promotion), Mr. Anayo Agu, alluded to this in his interaction with Tobi Soniyi

If there is something Enugu State is doing better than other states, it is how it has tried to address the unemployment situation in the country through the promotion of Small and Medium Enterprises.

Over the past three and half years, Enugu SME Centre has helped the state distinguished itself as the model state in the South East Geo-political Zone for micro, small and medium enterprise (MSME) development.

While Nigeria has for long realised the importance of SME in economic development, it has not been able to take advantage of this to galvanise the nation’s economy. For one, SME initiatives are often politicised. Second, those initiatives are more often than not carefully planned. They tend to be ad hoc and therefore lack sustainability. Another factor that has not allowed Nigeria to transform its micro, small and medium enterprise (MSME) programmes into a bigger success is failure to recognise cultural influences on businesses.

However, Enugu State has been able to avoid these pitfalls and has transformed itself into one of the primary reference centres and a benchmark on SME development not just in the South-east Zone but in Nigeria as a whole.

Special Adviser to the Governor on SME & Investment Promotion), Mr. Anayo Agu, explains how the state is able to do it.

According to him, it is not about politics. “We listen to you; we are not interested in your political affiliation. We are interested in your business ideas. It is not about who you know, it is about what you want to do. Secondly, it is open to anyone living and doing business in Enugu. It is not just for indigenes alone. Once you are living in the state and doing business here, we are not interested whether you are from Oyo state or Anambra state. We also have a rigorous financial literacy programme.”

When asked to explain what he meant by financial literacy, Agu said: “Financial illiteracy is one of the primary reasons most enterprises fail before their second anniversary. It has been identified as a major cause of most family disagreements including divorce. It is also adduced as a reason most graduates have low self-efficacy and are unable to start their own businesses or even own a small farm.

“Financial illiteracy is the principal cause of the inability of some beneficiaries of Enugu SME loan to repay as scheduled.

“Having recognised the above facts, ENUGU SME Centre is currently leading collaborative efforts through Enugu State Government bilateral relations with the German Government via its development agency, GIZ, to take financial literacy to the grassroots through the state science, technical and vocational schools, cooperative societies, and stakeholder groups particularly women in rural and urban markets.

“Furthermore, financial literacy is now a critical component of the curriculum of training on Master Class on entrepreneurship and enterprise development at Enugu SME Centre.

“It is expected that by year 2020, financial literary would have been mainstreamed into the teaching curricular for secondary schools and technical/vocational colleges in Enugu State. Furthermore, it is projected that about a million market women and social entrepreneurs would have been trained and given the knowledge and skills they need to take advantage of opportunities in their environments.”

Statistics show the Enugu SME model is working. From May 29, 2015 to December 20, 2018, the Enugu SME Centre facilitated loan disbursement to over 2,500 micro, small and medium enterprises under the Central Bank of Nigeria (CBN) N2 billion MSMEDF Programme and the Enugu State -Bank of Industry (BOI) Counterpart Funding Programme.

The centre also facilitated the funding of over 7,000 out of over 10,000 micro entrepreneurs under the Government Enterprise and Empowerment Program (GEEP). The beneficiaries are creating thousands of direct and indirect jobs in various communities in the state. They are also contributing to economic development while stemming rural-urban migration and crimes.

According to Agu, loan beneficiaries funded under some of the participating partner banks- Umuchinemere MFB, Ohha MFB, Ifeanyichukwu MFB, Kenechukwu MFB, Obollo MFB and Akudiewa MFB have already repaid about N400 Million to the CBN under the first tranche of the state micro loan totaling N500 million of over 10,000 registered.

“These micro loans specifically targeted micro entrepreneurs and enterprises artisans and traders (men, women and young people) in rural communities, who were trapped in poverty and hitherto excluded and forgotten. Without effective collaboration with our partner Micro Finance Banks, a transparent loan application process and inclusive governance, it would never have been possible to empower most of those beneficiaries who had no one in government”, he added.

According to him, Enugu isn’t just helping those with business ideas to realise their dreams, it is also helping them to create market for their products and services. For instance, between 2015 and 2018, the centre hosted three zonal market access seminars in collaboration with the DFID GEM4, BusinessDay, CBN, BOI (2016), and the Enterprise Development Centre (EDC) at the Pan-Atlantic University (2017).

So far, more than 2,000 participants have benefited from those trade events and attested to their effectiveness in match-making potential business partners and creating strategic alliances.

In February 2018, the centre in collaboration with Nigeria Export-Import Bank (NEXIM), Nigeria Export Promotion Council and Multimix Academy Lagos organised an Export-Import Finance Seminar for the South East Zone and Delta.

The export-import workshop, the first of its kind, has already resulted in the export of some products made in Enugu State to West and Central African markets.

In July 2016, the centre attracted and facilitated a visit by a delegation from the U.S. West African Travel Hub based in Ghana to visit SMEs in Enugu State for the purpose of identifying potential export products to the United States under the AGOA programme (African Growth Opportunity Act).

Artisans are also not left behind. Between June and October 2016, Enugu SME Centre held several enlightenment outreaches and stakeholder sessions for over 1000 members of the two leading auto associations in the state.

The centre also collaborated with University of Nigeria Nsukka (UNN) to train auto mechanics drawn from the two associations on the use of modern diagnostic tools for car repairs. About 35 auto artisans and mechanics participated in the maiden, one-month training.

People who are retiring from civil service are also not left out.

In September 2016, working in collaboration with the Office of the Head of Service and the South East Entrepreneurship Development Centre (SEEDC), the SME Centre held a one-day enlightenment seminar for Enugu State Civil Servants scheduled for retirement within five years. Over 500 potential retirees attended. In February 2017, as a follow-up to the pre-retirement seminar, the centre officially launched a four-week intensive entrepreneurship and financial literacy training for those scheduled to retire within two years. The programme called Pre-retirement Entrepreneurship Education Programme (PEEP) has successfully trained its 25 pioneer graduates.

The graduates have formed a cooperative society and are exploring opportunities.

If the centre sustains the momentum, it will help the state’s Governor, Ifeanyi Ugwuanyi, to deliver on his promise to make government services and resources available to create equal opportunity for anyone, who is willing to make a living, create wealth, send their children to school and enjoy life in a safe and secure environment.