Nigerian microfinance bank, Lift Above Poverty Organisation (LAPO) has proposed a total sum of N3 billion to support Micro, Small and Medium Enterprises (MSMEs) in 2019. The funds will be disbursed through LAPO’s subsidiary, Micro Investment Support Services Limited (MISS).
Elizabeth Ehigiamusoe, the Managing Director of MISS, who made this disclosure, said the sum of N2.8 billion was spent on the acquisition of 3,375 income-generating assets to support MSMEs in 2018.
The income-generating assets acquired, she said, include generating sets, motorcycles, tricycles, motor vehicles, household items, and welding machines, among others.
Ehigiamusoe said the sum represented 106 per cent performance over the sum of N2.6 billion disbursed by the subsidiary in 2017.
She added that the total lease portfolio of the company increased from N1.89 billion in 2017 to N2.16 billion in 2018, while repayment grew from N2.07 billion in 2017 to N2.53 billion in 2018, representing 22.20 per cent performance increase.
Why MSMEs funding
The role of SMEs in enhancing economic growth and development has overtime been widely acknowledged globally. Economic wealth all over the world is created through enterprises and the expansion of their output.
SMEs contribute to the economy by creating value through the production of goods and services, thus enhancing the gross domestic product. They also generate employment by creating much-needed jobs in the economy as well as expanding the export sector largely through linkages with large firms that produce for the foreign sector.
Lack of adequate funding has been the major challenge Nigerian SMEs have raised concerns about. The SMEs stakeholders have overtime lamented the absence of adequate credit facility startups and business expansions.
LAPO is a microfinance bank that focuses on assisting the poor, especially the women, in raising their socio-economic statuses. It does not only act as a microcredit institution but also assists clients in overcoming problems beyond the lack of funds, such as illiteracy and environmental degradation (which often aggravates poverty).
The institution was founded by Godwin Ehigiamusoe while working as a rural co-operative officer in Delta State, Nigeria. LAPO started its activities in 1987.
FG to support MSME contribution to economy to boost development – Minister
The Minister said that the FG has schemes aimed at improving the post-pandemic climate for SMEs in Nigeria.
The Federal Government declared that it is working with stakeholders to improve MSME participation in the economy through improving the business climate which will create jobs.
This was disclosed by Amb. Mariam Katagum, Minister of State for Industry, Trade and Investment, at the 7th EMPRETEC Global Summit, on Tuesday, themed “The Role of Entrepreneurship, MSME and EMPRETEC in post-COVID-19 Resurgence.”
The Minister stated that the MSME sector of the economy is the growth engine of any economy which contributes to its development, job creation and export, amongst others.
“An MSMEs survey indicates that Nigeria’s SMEs contribute nearly 50 percent of the country’s GDP and account for over 80 percent of employment. No doubt, the sector is pivotal to Nigeria’s growth, including reducing poverty and unemployment levels.
It has, therefore, become more apparent that supporting entrepreneurs and small businesses by creating opportunities for MSMEs to thrive is essential for increasing productivity, creating jobs, and boosting our economy.
This is why the Government is working with stakeholders across all sectors, to create the enabling environment for entrepreneurs and MSMEs to ensure that they grow now and into the future,” she stated.
On economic sustainability
The Minister said that the FG has schemes aimed at improving the post-pandemic climate for SMEs in Nigeria. She also disclosed that the FG launched the National Policy on Micro, Small and Medium Enterprises (MSMEs), a framework for the resolution of the challenges faced by the sector.
The programmes launched by the FG includes the Survival Fund and Guaranteed Off-take Schemes, operated by a Steering Committee in the Ministry of Industry, Trade and Investment.
“The Government of Nigeria had, prior to the outbreak of COVID-19, initiated the MSMEs Clinics scheme as a strategy, aimed at providing support for the MSMEs in the country.
At the clinics, operators in the MSMEs space are engaged by regulators and business advisory experts, on issues ranging from entrepreneurship, skill development, finance, quality & standards, and on how to facilitate and grow their businesses and enterprises,” she added.
What you should know
Nigeria’s unemployment rate as of the end of 2020 rose to 33.3% from 27.1% recorded as of Q2 2020, indicating that about 23,187,389 (23.2 million) Nigerians remain unemployed.
A combination of both the unemployment and underemployment rate for the reference period gave a figure of 56.1%. This means that 33.3% of the labour force in Nigeria or 23,187,389 persons either did nothing or worked for less than 20 hours a week, making them unemployed by our definition in Nigeria.
Amazon to open its first African office in South Africa
Amazon already launched its data centres for AWS in Cape Town but its eCommerce services had until now, not been available in Africa,
Amazon, US retail giant has announced that it would be opening its first African office in South Africa with a real estate investment of over R4 billion. This announcement is coming a week after Twitter choose to open its first African office in Ghana.
Authorities in Cape Town noted that Amazon would be occupying a new development in River Club, a prime section of the city. This new development will create 5,239 jobs in the construction phase alone. Along with 19,000 indirect and induced jobs.
The 15-hectare parcel of land will cost R4 billion and include two precincts. Authorities said the first precinct of 60,000sqm will occupy different layers of development; while the second section of 70,000 will hold Amazon headquarters in Africa.
Cape town city officials noted that “US retail giant, Amazon, will be the anchor tenant, opening a base of operations on the African continent. The development is envisaged to take place in phases, with construction set to take place over three to five years.
It is clear that this development offers many economic, social and environmental benefits for the area. We are committed to driving investment to revitalize the economy, which is slowly recovering following the impact of Covid-19.”
What you should know
Amazon already launched its data centres for Amazon Web Services (AWS) in cape town but its eCommerce services had until now, not been available in Africa.
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