Remarks by
His Excellency, President Goodluck Ebele Jonathan, GCFR
At the
8th Annual Micro, Small, and Medium Enterprises (MSMEs) Conference
Organized by the Central Bank of Nigeria
PROTOCOLS
1. I
am delighted to join you here today at this 8th Annual Micro, Small,
and Medium Enterprises (MSMEs) Conference. Let me begin by commending
the Management of the Central Bank for hosting this important conference
yearly, in support of the Transformation Agenda of our administration
and our joint commitment to inclusive growth and job creation.
2. Micro,
Small and Medium Enterprises (MSMEs) are recognized, all over the
world, as the engine of growth in any development oriented economy. Due
to their inherent labour intensive production processes, they also
provide a viable platform for job creation.
3. All
over the developed world, the contribution of MSMEs to GDP averages
about 47 percent. However, here in Nigeria, MSMEs account for only 10
percent of our GDP.As reported by the Small Medium Enterprises
Development Agency of Nigeria (SMEDAN), there are about 17.3 million
MSMEs in Nigeria compared to the over 40 million MSMEs in Indonesia,
whose population is only a little greater than ours. Some of the reasons
adduced for this disparity are the limited access to finance, low
production technology, poor infrastructure and lack of market access.
4. Ladies
and gentlemen, these challenges call for more concrete and concerted
measures to enhance, and expand the activities of MSMEs in our country.
The focus of this year's conference - Charting Ways to Resolve the Problem of Access to, and Cost of Finance to MSMEs in Nigeria - is, therefore, quite appropriate.
5. There
is no doubt that a vibrant MSME sub-sector is indispensable for
achieving sustainable transformation of the Nigerian economy. As
Africa’s largest economy, with excellent prospects of becoming one of
the 20 largest economies in the world in the nearest future, it is
imperative that the challenges confronting MSMEs are addressed
frontally, at this time.
6. Our
administration has already instituted a number of reforms to improve
the enabling environment and build strong institutions that would
fast-track the progress of MSMEs. Given that the structural
transformation of the economy remains our core priority, we are
investing heavily in critical infrastructure to promote job creation and
inclusive growth. We are aware that inadequate infrastructure increases
the cost of production by an estimated 30 percent, making Nigerian
goods under-competitive.
7. The
Federal Government believes that stable power supply is the bedrock of
our industrial development and economic progress. It will not only
reduce the cost of manufacturing and services significantly, it will
also engender investment and create jobs. With these economic benefits
in mind, we are vigorously implementing the power sector reform
programme.
8. Under
this Agenda, the Power Holding Company of Nigeria (PHCN) has been
unbundled, resulting in the creation and subsequent privatization of
several Generation and Distribution Companies (DISCOs) across the
country.
9. I
am glad to note that in spite of the initial challenges associated with
new ventures, some of these companies are already doing well. It is
indeed encouraging that the CBN is working closely with the Ministries
of Petroleum Resources and Power as well as the National Electricity
Regulatory Commission to address the funding issues related to gas
supply that would increase power generation capacity to 5,000 megawatts
within the next few months.
10. Ladies
and gentlemen, in view of the enormous benefits of backward integration
with local MSMEs, our administration has also initiated policies to
promote large-scale manufacturing ventures in our country. The new
automotive policy has already received commitment from investors such as
Nissan Motors, which rolled out its first set of locally produced cars
in April this year. Our expectation is that the associated patronage of
the automotive industry would significantly boost the sales and survival
of MSMEs in our nation.
11. We
have also unveiled the new National Industrial Revolution Plan (NIRP),
as the roadmap for national industrialization. The NIRP would provide a
strategic link between the industrial sector and the agricultural
sector, where we have comparative advantage.
12. To
further boost job creation, and harness the huge potentials of our
teeming youth, a multifaceted entrepreneurship programme, ‘You Win’
was launched in 2011. So far, 'You Win' is yielding positive results. A
new crop of innovative and youthful entrepreneurs are emerging from the
programme, and employing many more in the process.
13. The
huge food import bill that is threatening our national food security
posture is steadily being addressed and effectively reduced. We are
working vigorously to decrease rice imports through several policies and
by working closely with the farmers, big and small alike.
14. On
the back of several interventions by this administration, including the
provision of improved seeds, fertilizer and irrigation support, and
concessionary loans, our farmers were able to produce 7 million metric
tonnes of rice paddy between 2012 and 2014. To complement our effort,
the private sector is investing in the various aspects of the rice value
chain. For instance, the Dangote Group has just announced plans to
invest up to US$1 billion in commercial rice production and the
construction of modern integrated rice mills across the country.
15. I
would also like to commend the CBN for its immense support for our
Agricultural Transformation Agenda (ATA), particularly through the
Growth Enhancement Scheme (GES) under the Nigerian Incentive-Based Risk
Sharing System for Agricultural Lending (NIRSAL). As a de-risking
mechanism, this innovative scheme has provided guarantees and interest
subsidies of over N29 billion for 158
agro-dealers. It is also facilitating the supply of improved seeds and
fertilizer to the primary producers in the agricultural value chain,
with visible results.
16. As
part of measures to enhance the contribution of MSMEs to economic
growth, the Federal Government will establish a Wholesale Development
Finance Institution (DFI), which will provide long term funds of up to
15 years for industrial development. Existing DFIs would be restructured
for better performance and improved access to finance by MSMEs.
17. Distinguished
ladies and gentlemen, the enormity of the task ahead demands immediate
and dedicated action. That is why I am kick-starting today, the
disbursement of the N220 billion MSME Development Fund
to participating financial institutions and State Governments for
onward-lending to MSMEs across the country. At the same time, we are
addressing issues such as money and capital market options for MSME
Financing, leveraging technology for financial services delivery to
MSMEs, financing techniques for SMEs in the oil and gas, agricultural
value chains and services sub-sectors.
18. It
is my hope that the Executive Governors will seize the opportunity
provided by their Special plenary session to showcase their efforts to
promote inclusive growth through micro credit delivery, job creation,
poverty reduction and economic empowerment. I will be presenting ‘The Entrepreneurship Awards’
to deserving State Governments, financial institutions, individuals,
cooperative societies, donor partners and other corporate bodies, who
have distinguished themselves in entrepreneurship development in Nigeria
in 2013.
19. Your
Excellencies, distinguished ladies and gentlemen, I am confident that
these initiatives will assist us in consolidating the remarkable
achievements we have made in our efforts to structurally transform our
economy. We must continue to work together to build on this progress, so
as to achieve the major goals of the Transformation Agenda, including
job creation and poverty reduction. Our people must be provided
opportunities to live better and more productive lives.
20. On this note, it is my honour to declare this 8thAnnual Micro, Small, and Medium Enterprises (MSMEs) Conference, open. I wish you all very fruitful deliberations.
21. I thank you.
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