Simeon Mpamugoh

Prince Orimadegun Agboade is the President and Chairman, National Association of Small and Medium Enterprise (NASME). A member of the 22 -member Council for Nigeria’s Micro, Small and Medium Enterprises (MSME s) chaired by the Vice President, Professor Yemi Osinbajo, Agboade, who is also the Chairman/Managing Director of Orfema Pharmaceutical Industries Limited, in this interview, said that the Federal Government has put in a lot of efforts to stimulate growth of the small and medium enterprises, but noted there are still much to be done.


FG’s intervention to buoy SMES

Government has put in good efforts to promote SMEs growth but we are not yet there. There are some initiatives government has put in place such as the MSMEs business clinics which has been to over 21 states of the Federation. NASME was given the unique opportunity to speak on behalf of the Nigerian MSMEs when the programme was launched at the Villa. I gave the goodwill message to government and any where the paraphernalia of the clinic moves, all the agencies, directors general of parastatals’are always there to solve problems, such that anyone that was brought there, the vice president would ask the sectoral agency to resolve it. The government has also been briefing us during quarterly presidential briefing on the state of the economy. So, government has woken up with some initiatives and part of it is already yielding fruits such as the registration of companies, which lifted the ranking of Nigeria from 169 to 142. Now, you can register your company in the comfort of your room and do all the submissions of documents.

Funding as regards finance, not much has been achieved because government has a lot of windows for MSMEs that has not been opened. CBN has nine per cent intervention fund but not many get to access the facility. Broadly speaking, government’s efforts in nurturing SMEs have started well but they need to sustain it. Don’t forget that we have Executive Order 4, which was primarily directed at SMEs in the area of procurement. Anything agencies are buying, they should first consider MSMEs and, of course, we have been seeing some dividends in that order.

BoI support

Bank of Industry (BoI) has been very supportive of SMEs. The bank is one of the founding fathers of NASME, which is a kind of organisation formed by agencies of government: Central bank, Bank of Industry, Federal Ministry of Industry, Trade and Investment. BoI is an institutional member of NASME. In the last programme, we had at June 12 Cultural Centre, Abeokuta, they supported us very well. In the area of loan performance, the bank is doing its best. Part of the problems of our members is that, they may not have bankable projects and accounts, so the bank employs different development companies to nurture and do a kind of handholding with MSMEs in getting them to qualify for loan. It has approved some good network companies and individuals in Nigeria; about five of them, including Dangote who brought N5billion for Micro, Small and Medium Enterprises. It was administered by BoI. Apart from Dangote and others, the bank still went ahead to sign MoU with state governments to put N2billion on the table and for the bank to put a matching grant of the same amount to boost SMEs.


There are specific aspects of the plan that addresses the concerns for SMEs. Because of overhead costs, government realises that SMEs are already dying off. After oil, what comes next, Small and Medium Enterprises, Of course, government is trying to bring SMEs up through the business clinic and ease of doing business, which is the real group headed by the Vice President Osinbajo and the secretary, Dr. Jumoke Oduwole. We are close to them and know what they are doing. Things had gone bad for too long, and they are trying now to put the piece and pieces together. It’ll take time. We commend Osinbajo for the effort. I was present one day when he was addressing level 14 and above officers in the civil service, which happens to be the engine room of government business. He told them in groups that; “You must do everything possible to encourage and assist MSMEs to come up. And if any one puts any stumbling blocks in the way of these people, the person is putting stumbling blocks in the way of next generation and our children”. He is passionate about the growth of the MSMEs. And this confirms the fact that there is no major event that government would plan that NASME would not be involved. The focus lab is directing a searchlight on some critical areas, and in solving such problems, SMEs have not been left behind.

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The first should be the Infrastructure. This should include but not limited to power, road, railway and ease of doing business. These are key. You would agree with me that these had been stumbling blocks to business growth. Recently, the Vice President indicated, in the last Investment Forum I attended in Abuja, that Nigeria has been rated one of the best countries in Africa and, of course, the whole world with rapid economic recovery. It is quite an achievement that encouraged me. So, the ERGP focus labs are tailored towards the whole economy. The small businesses are not left behind. If companies would have to be using electricity to produce, many of them would not go moribund, and the generators have to rest.
Interest rate

I’m not sure if CBN had pegged interest rate at 14 per cent. But if that is correct, it is a good omen because if interest rate was benchmarked, people would be able to borrow, invest, and produce more. But if it is not benchmarked, a lot of people would resign to their fate and there would be less investment, income and the government purse would suffer. However, a lot of people argue that  it is not possible to get single digit interest rate because the bankers would say they are not the owners of the money they are using neither is it government money. And they have to give good returns to the owners of the money and of, course, how could  they charge something less. Having said that, I’m saying that single digit interest rate is achievable but it may not be across board. What we are pleading is that government should do it for the small and medium enterprises and people would be encouraged to invest. I’m not among the school of thought that says everything should be crashed to single digit. It may not be practicable but I know it could be possible for the MSMEs use.


The Nigeria Export Promotion Council (NEPC) has some initiatives for export. They also invite our members and non-members alike for orientations and training on export. Part of our challenges is marketing. Where do we sell our products? Exportation could be a way out but there are also some issues we need to resolve because quality of what you need to export matters. We need to improve on this before exporting. The international community has at one time rejected our beans and yam. They claimed they had some insect infections, and that borders on quality. The United Nations Industrial Development Organisation (UNIDO) is doing a fantastic job; they have what is called National Quality Infrastructure (NQI), which identifies some issues surrounding quality. But how do we resolve it? We are saying quality of our products is so low that UNIDO had to set up a company called Nigeria National Accreditation Service (NINAS), which deals with quality of each of our products and those that needed to be taken to lab. NINAS also do lab accreditation; all aimed at building blocks. It is a way to build infrastructure: accrediting laboratories and getting people to be trained as auditors, who go about auditing the companies as well as facilities they are using.

I don’t agree that tax is the only way governments can raise Internally Generated Revenue (IGR). There should be more other ways. Let me start with our people. Nigerians, if I may say, don’t like to pay tax. If you ask me why? It could be because they have not been able to see what their money has done for them. The economy is just tough that talking about paying taxes people would think it should not be mentioned at all. Even in local villages, when a tax man comes, the man escapes through the back door. It has been like that but what government is trying to do now , which NASME supports, is that IGR can be raised through other means. Taxing few people to their last blood is not the right way. We can enlarge the tax base instead of asking few people to pay tax. For Instance I took C of O for the land I built my factory. I’ve been paying the Land Use Charge (LUC), while a lot of houses around my factory don’t pay. Why should it be so? Let’s widen the tax base so that a lot of people can come in, and you reduce the tax for the few you are having on the net. This has been the problem with tax administration in the country. Of course, some NGO are working with NASME to make our members tax ready. We need to accept the philosophy that paying tax is good but it must have a human face. I used to have a pick up van for delivery of goods. I sold it off because we counted 17 taxes; permits, licenses and signage we were being asked to pay.

Challenges of SMEs

There are many challenges facing SMEs. Some of them are even stifling the growth of SMEs in Nigeria. The first on the list is infrastructure challenge. An average SME owner provides his own water through borehole. We also have electricity challenge. Many of them are thinking of shutting down for a while and laying off staff because it is expensive running business on diesel. I put all that under infrastructure deficits. Of course there is equally the duplication.