The Misfortunes of Nigerian Economy and the Survival of the SMEs

We’ve heard every time about how the Nigerian economy is so much of a mess right now and might even get worse as time goes on. Although—probably for political purposes—some international organizations release some data sometimes to claim that the Nigerian economy is fast growing or it’s promising, but the few undelusional people left would know those claims are nowhere near the truth about the Nigerian economy. The exchange rate of Naira to the most used currencies in the world gets worse at every glitch the country experiences; it doesn’t even have to be an economic glitch for the Nigerian economy to respond to it, and mostly, the responses are negative.

The Government has to opt for loan to be able to take up any project at all, and necessarily seek for aids in any impact of disease or terrorists on the society, i.e. the COVID-19 pandemic and how the government still doesn’t know how to contain it or be able to provide adequately the needed equipment for such crisis. All these are proves that—if the Nigerian government cannot come up with any feasible plan to contain a pandemic or at least control it and the people so that it wouldn’t ruin the economy this fast—there is no way the government has a sure plan for stabilizing the economy or for improving it. Meaning it can only get worse (it sounds pessimistic, but that’s just the reality).

As the Nigerian economy ebbs at every little instance it could do that, what hope do the Small Scale Enterprises (SMEs) have to grow bigger or even survive at all? Surely, when the economy goes bad, when the country goes on taking loans and so on as par how the Nigerian government behaves—apart from the fact that the people would have to lack even the basic things they deserve at citizens—the enterprises are always the side to carry the burden and pay the debts with more taxes loaded on their production and sales, and the enterprises as well would have to load the burden on their consumers too—the people. Which boils down to the fact that the burden of a bad economy is the people’s to bear. This transfer of burden from the enterprises to the people is workable when it involves the Large Scale Enterprises (LSEs), as the consumers are attached to their products and services and would rarely want to try to detach, and mostly, the LSEs are essential services and monopolized, and the ones that are not so essential already have their ways around manipulating the government to have influence on the policies they make so they don’t affect their companies too negatively and beyond control, which leaves the sufferings to the SMEs, and this makes the major part of the reasons why most of the SMEs never get big.

As a small scale entrepreneur, what’s there for you to do so your company is one of the very few of the SMEs that would survive the harshness of the careless policies the Nigerian government makes? I will discuss just one of the points here and discuss the rest of them on my vlog on Instagram TV, just click on and look for this topic on the channel to follow it.

1. If you are starting small, don’t make the mistake of starting your business with a loan; you already have too much to war with: the slow pace of growing, the vulnerability of your business to any bad policy from the government or happening in the society, the effect of time testing how you can hold on even when your business only makes you losses and not yet any real profit. Adding the responsibilities of having to pay back the interests on the loan or having to service the fines on the loan when you don’t pay as schedules would only make you an entrepreneur who only makes profits for their lender and never make much for themself, and this would surely kill the business sooner or later.

2. Continue on IG TV

About Olusegun Peters

Olusegun Peters is a businessman, a politician, a scholar and a crypto enthusiast. He is passionate about impacting as many people as possible one person at a time. Read more about Olusegun here

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