In the face of Nigeria’s economic realities where virtually all macro-economic and fiscal indices are trending negative – low oil prices, spiraling inflation, capital market bearish performances, exchange rates depreciation and the dwindling foreign reserves. The outlook for growth in 2016 is weak and several key sectors including oil & gas, manufacturing and government are already in recession while most others are experiencing sharp slowdowns.

With the current economic realities as enumerated above, it will be an uphill task to resolve it any other way than through the intensive promotion of entrepreneurship and SME development as practised by other successful economies and markets.

According to the United Nations industrial development (UNIDO), MSEs or SMEs have a significant role to play in the economic development of any nation because they form the backbone of the private sector and are the biggest employers of labour in both advanced and developing economies. The national bureau of statistics has put the total number of SMEs in Nigeria at 17 million providing jobs to over 32 million people. But this critical sector still lacks the support it deserves.

Where formal labour markets have failed to provide jobs, people have had to turn to entrepreneurship and SME development for economic survival. However, SMEs have high failure rates in the absence of the needed capacity building for success. One critical element research has shown in improving the survival rates of SMEs are in improving the managerial competencies and capability of their managers/owners. A variety of controlled trials by the International Labour Organization (ILO) have shown that access to management training improves significantly SMEs survival and growth rates.

Unemployment is another very big challenge in Nigeria, especially among the youths as the rate swell by the day, as more employees are laid off and a lot more jobs than ever are being outsourced. Presently, there are about 42 million unemployed people in Nigeria (24.7% of the population – NBS) with little hope of ever getting a job in the nearest future.

The foregoing are the stark realities of the times we live in and may as well have become “the new normal” condition of our society, where job security and pensions are becoming extinct while the unemployment market swell by the day, with the few available jobs being outsourced.

The most dramatic is the hint from President Muhammadu Buhari that the centre is equally broke and might not be able to bear the cost of the federal cabinet. This is at a time when the country’s Monetary Policy Committee (MPC) has equally stated that the economy might go into recession in 2016 if nothing drastic is done. The nation’s capital market is not left out as it is presently comatose and losing billions by the day.

Now what do we do as a nation, bearing in mind that most businesses in Nigeria rely on government patronages, contracts and spinoff for survival, as government is the biggest spender? What options then do we have as a people; do we lay back and wait for the worst, come January 2016, or as a people we put on our thinking cap and creatively/innovatively manoeuvre our way out of this jigsaw puzzle?

While we consider as a nation, steps that we should suggest to the leadership to take as remedies for the present state of affairs, on individual level it is imperative that Nigerians, especially those in paid employment and owners of small businesses (SMEs), empower themselves effectively with relevant entrepreneurial knowledge and business intelligence to secure the financial security and freedom, as well as gain control over their lives, and acquire the shocks needed to absorb all the economic and financial uncertainties that may arise. As well as utilise their skills, ideas and talents to create businesses that would add up in boosting the market and the economy, while helping to expand the opportunity space in Nigeria for an inclusive society.

It will be an uphill task to resolve the current economic and social realities in Nigeria as enumerated above any other way except by the instrumentality of entrepreneurship (even in governance). This is what many other economies and markets globally are doing to scale through their challenges, and Nigeria cannot be an exception because entrepreneurship provides us windows out of the present economic and social state. It offers us a platform through which innovation and job creation, with the right dose of ideas and inspiration, can grow and sustain the economy and boost our market. The small and medium scale enterprises (SMEs) and the entrepreneurs are the engine of any economy, the right set of encouragements to this sector in Nigeria therefore (as one of the remedies), will boost them to confidently take their place in the economy and effectively make their contributions to remedy the current situation.

We desperately need to impart to the youths and those in various levels of influence, the entrepreneurial skills and business intelligence needed to raise the next level of business leaders in the country, especially encouraging leading bottom up, with efficiency and high productivity needed to create the impacts that will transform the society and the people. We will need transference of unction of experience and success from entrepreneurs and business people who are already a success to share from their experiences, motivations, visions and ideas, because of the universality of application of principles, when it is well appropriated it is non-discriminatory and whatever has worked for one will surely work for the other. Examples are the best teacher, as the best way to learn a thing is to understudy someone who has done it before. The secret of men are in their stories, the stories from these entrepreneurs therefore have the potency of replicating themselves in the life of anyone who cares to appropriate them and should be taken advantage of. It is a role modelling methodology, giving guidance and enthusiasm to proteges, in order to hasten and enhance the time of accomplishment of their tasks.

We need to build more capacities and competencies through knowledge, skills and platforms for networking and learning among entrepreneurs in Nigeria, promoting and developing enterprise skills and business intelligence in Nigeria as a culture and new form of thinking, for wealth creation, employment generation and poverty reduction. In so doing we build an enduring solution to the perennial unemployment problem and low productivity in this part of the world, so as to improve the standard of living and reduce poverty among the people. Our young people desperately needs to be equipped with the requisite sets of competencies, character and capacity to jump start the economy and drive it to the desired point.

Some of the ways to achieve all these include ingraining global best practices in our business operations, placing emphasis on innovation and entrepreneurship in order to build sustainable and profitable businesses that would enhance the standard of living of the people through enlarged opportunities and employment space, systematic methods of learning to encourage speedy and sustainable results, which includes, case study methods, brainstorming sessions and study groups, mentorship, tutelage and follow-up sessions. Everything needed to be learnt in whatever format should be encouraged in order to make a success of any business or enterprise this youths venture into.

If we are able to appropriately engage in the aforementioned, the learning objectives would therefore be to achieve certain cutting edge skills for high productivity among the youths. Such skills include critical entrepreneurial knowledge and know-how, excellent financial literacy, leadership skills, communication and people management skills, core marketing and sales skills, information technology (IT) skills. Especially for those with little or no prior business/enterprise knowledge and experience, who will therefore need competencies in the area of:- Business writing, Business development, Financial management and Communication skills. For those currently running enterprises but are experiencing operational/growth challenges. The competencies required would be cash flow management and inventory management skills, digital technology and social media skills, and relationship skills. And for those with significant successes in business but are looking to diversify and break new frontiers, the competencies required would be leadership skills, networking skills, advanced financial management skills and relationship skills. The foregoing if taken care of and impacting on a demography of a youthful population (about 60 per cent of the Nigeria population are youths), our economy has no option but to naturally respond on a positive note and be sustained.

On a broader outlook, the economy needs to be better handled and managed, the fiscal and monetary policies deserve a better handling, a choice between managing inflation and creating employment still needs to be made. Do we maintain national pride of having our local currency be the only legal tender for transactions within our borders, at the expense of high interest rate, due to the system of managing this strategy? Do we continue in the current system of managing the monetary policy; where the central bank have to print Naira for every dollar of our national income meant to be injected into the economy, only to turn around and engage in the vicious circle of managing inflation and interest rates? This system as it is presently operated puts us at the short end of the stick whatever the case is; if our commodities are highly priced in the international market, we cannot benefit from our high earnings and reserves by way of currency value appreciation, equally so for when the commodities are down (then it even becomes worst because in addition, we have to deal with the short fall in revenue and budget deficit management). With this system therefore, we are forever down as a nation no matter what our lots are. Should we be bold enough to take our destiny in our hands by either dollarising our economy (by the way most choice items and properties in the country are already dollarised – unofficially you may say), or we find an innovative method of injecting our dollar receipts into the economy, a method which would not have to by the same breath trigger off inflation, high interest rate and the crowding out the real sector from the credit market? This can be by issuing dollar receipt or vouchers to recipients and beneficiaries, like the three tiers of government, contractors and expatriate staff, instead of issuing Naira for their dollar receipts, only to turn back and buy them again from the banks at 10 to 15% in 90 days monetary instrument, and the circle continues, interest rate is heightened, as this becomes a threshold, of course it bear almost no risk, so the banks prefers them to borrowing to the real sector, and then low activities will be registered at the real sector of the economy, therefore resulting in less employment and then higher poverty index, and the circle continues.

We need better and functional government and governance structures, better indigenous economic participation and fiscal structural system and budgetary procedures and systems, and these all require a substantial level of being entrepreneurial, innovative and creative, with a good dose of thinking outside the box and being pragmatic, result oriented and focused to achieve.

Next week, we shall continue this discussion in part two of this write-up.

•Lawrence Nwaodu is a small business expert and enterprise consultant, trained in the United Kingdom and the Netherlands, with an MBA in Entrepreneurship from The Management School, University of Liverpool, United Kingdom, and MSc in Finance and Financial Management Services from Rotterdam School of Management, Erasmus University Netherlands. Mr. Nwaodu is the Lead Consultant at IDEAS Exchange Consulting, Lagos. He can be reached via nwaodu.lawrence@hotmail.co.uk (07066375847).

Update news