In a bid to enhance the growth and development of small businesses in the state and its environs, The Honorable Commissioner, Ministry for Local Government and Chieftaincy Affairs Plateau State, Chief Ephraim Usman has made significant contributions towards establishing alliances with community organizations and non profits to support under-represented and marginalized entrepreneurs in Plateau state.
Chief Ephraim Usman disclosed this at A One Day Stakeholders and Entrepreneurship Meeting for small businesses in Plateau State held at Crispan suites and event center in Rayfield, Jos, Plateau State.
While addressing the stakeholders and entrepreneurs, Chief Usman explained that 48% of the Nigeria’s Gross Domestic Product (GDP) is from Small and Medium Enterprises (SMEs) and over 84% of jobs are created in the Small Entrepreneurship.
“According to the National Bureau of Statistics (NBS) in 2023, SMEs employ large proportion of the workforce and they account for 96% of businesses across the Nigeria’s economy. This means that the informal sector where these small and medium businesses exist must be properly engaged and utilized by the government in order to bring about significant improvement in the wellbeing of our people. Apart from creating employment and raising the standard of living of our people, small entrepreneurs are catalysts, for absorbing social shocks and acceleration of poverty reduction mechanism from the community levels” Chief Usman disclosed.
“In Plateau state, the relevance of small and medium enterprises for the growth and development of our people especially from the community and/or rural areas is of utmost concern to His Excellency, the captain of the “Time is Now” administration, Barr. Caleb Manasseh Mutfwang. It is thus the priority of the government to address poverty, unemployment and social vices amongst the population through constructive re-engineering of the state’s economy”
“Infrastructure that support small and medium businesses are being fixed; conflicts that hitherto threatened businesses including agro-sector enterprises are being addressed; while major re-organizations in the transportation and entrepreneurship sectors are becoming part of key indicators in the policy direction of the government in addressing socio-economic challenges of the people in the state” Chief Usman revealed.
“Government is aware that there are under-represented and marginalized entrepreneurs across the 17 local governments. These are vulnerable groups such as women, minorities and individuals from low income backgrounds, who are involved in one small business to the other. But one of the questions that this engagement and discussions must address is: How can we establish alliances with community organizations and non-profits to support the under-represented and marginalized entrepreneurs on the Plateau? As a government, we are poised via the 7 point agenda of H.E., the governor to address the challenges associated with the business environment and focus towards improving ease of doing businesses on the Plateau”
Therefore, this keynote focuses on:
1. Underscoring the Context of SMEs, Community Organizations and Non-profits in Plateau state.
2. Overview on Marginalized and Under-represented Entrepreneurs.
3. Establishing Alliances with Community Organizations and Non-Profits to support entrepreneurs.
4. Roles of Government.
5. Challenges.
6. The Way Forward.
CONTEXT OF SMES, COMMUNITY ORGANIZATIONS AND NON-PROFITS IN PLATEAU STATE
SMEs
There are several Small and Medium Enterprises in Plateau state. The classification of these enterprises into small, medium and large scale is relative and varies from country to country. However, the Companies and Allied Matters Act (CAMA), 2020 defines a small company as:
“a private company having an annual turnover and net assets value of not more than N120,000,000 and N60,000,000 respectively, it has no foreigner as its member and where the company has a share capital, the director hold at least 51% of the share capital”.
But the above definition has been adjudged to be in variance with the one provided by the Finance Act, 2019 an amendment were made in 2020 Finance Act mostly for the purpose of annual returns and taxation.
However, the context of this engagement and for the purpose of clarity, the Small and Medium Enterprises (SMEs) on the Plateau, herein referred to as the marginalized and under-represented cuts across low capital enterprises ranging between capital base of N10,000 – N500,000. This figure represents what most of the businesses get as small start-ups from national empowerment schemes in Nigeria. This is also an opinion that stems from results of empirical findings from a study on “small businesses and impact of selected businesses on Plateau state” (Yakubu, 2023). These businesses are characterized by the following:
(a) Low capital base ranging between N10,000 – N500,000.
(b) Ownership is by individuals or family.
(c) Source of capital is usually savings, borrowing and inheritance.
(d) It is often informal devoid of hierarchy, rules and regulations, record keeping and so on.
Community Organizations and Non-Profits: These are simply community based organizations aimed at making desired improvements to a community’s well-being such as health, education, agriculture, religions, and business endeavours.
They include the following on the Plateau:
– Community work and prospects such as the ones by the Community and Social Development Projects (CSDP) supported by World Bank, UNESCO, USAID and so on.
– Community development organizations such as local NGOs and corporations.
– Community empowerment such as faith based organizations.
– Community mobilization
Examples also cut across church groups, youth groups, community support groups, spirited foundations, advocacy groups, etc.
The primary function of community organizations is to organize, mobilize and educate people to build a sense of community. By doing so, the community gains power or influence over issues concerning their welfare.
By extension, the community organizations are non-profits. This indicates that despite the fact that community organizations are private or non-governmental organizations, the prime goal is not to make profit but to provide services to the communities such as building of primary health care facility, provisions of business training and start-up packs, undertaking agro-extension services, building market stalls, conducting business surveys and consultancy for small businesses, providing inputs to farmers and so on.
WHO ARE THE ENTREPRENEURS DESCRIBED AS MARGINALIZED AND UNDER-REPRESENTED
An entrepreneur is simply a person who sets up a business or in some cases businesses taking on financial risks in the hope of profit making. There are many of them in our markets, homes, street corners, communities, road sides, offices and so on. These people doing their legitimate businesses are either not represented, under-represented or marginalized when it comes to the following:
1. Access to loans or capital to expand and grow their business.
2. Training and capacity building to improve on their business.
3. Access to markets, stores, shops and space to display their goods/services within the community markets.
4. Access to governments’ palliatives to cushion harsh economic changes.
5. Raw materials and inputs for their business.
6. Marketing boards or cooperatives to sell their goods and services without the exploitation of middlemen.
7. Storage facilities particularly for perishable items.
8. Security and safety of lives and properties.
9. Basic market facilities such as water, toilets, access roads, security outpost, parking spaces and first aids/health facilities amongst others.
It must be noted that as a Ministry that is directly working with traditional rulers, local governments and by extension, the communities, I am aware of the critical challenges confronting businesses in our rural markets. The yam market in Bakin Chiyawa, Doka and other Yam producing communities in Qua’anpan or the potatoes, cabbage, carrots, berries, cucumber, rice, maize, millet, cassava, sugarcane, guinea corn, groundnuts, beans, or even the local Tarok yam called “Turret” are all agro-produced within the chain of businesses on the Plateau where those who actually produced them do not have a voice of their own. Secondary and tertiary businesses in Amper markets, Dengi, Pankshin Monday market, Terminus general areas in Jos, Bukuru market, Angware, Jengre, Ampang West, Dyis Abwor, Garkawa market, Building materials market, Farin Gada market, Dilimi and all across the state have entrepreneurs whose under-representation in the above mentioned areas constitutes cumulative challenge to their existence in the markets.
On the other hand, permit me to also acknowledge many youths and women who are doing legitimate businesses like bakers, fashion designers, musicians/entertainers, bloggers, content creators, she/footwear makers, stylists, etc. A lot of them do not have access to the items mentioned in this paper, hence could be adjudged as “marginalized” with low income backgrounds.
ESTABLISHING ALLIANCES WITH COMMUNITY ORGANIZATIONS AND NON PROFITS
Alliances are simply a union or association formed for mutual benefit. They are also a relationship based on similarity of interests, nature and qualities amongst entrepreneurs. The benefits of establishing alliances with community organizations and non-profits are vast and indispensable.
First, alliances could bring about business support, in terms of access to loans, and entrepreneurial empowerment.
Secondly, establishing alliances will be a sure way to organize businesses into corporations for the purpose of accessing government intervention programmes for entrepreneurs.
Again, community projects such as market stalls, stores, warehouses, security, access roads, mobility of goods from farm to markets, and other facilities are better achieved through alliances.
Moreso, market monopolists would be easily regulated through alliances between community organizations and enterpreneurs. This can open up healthy competition amongst businesses.
How are Alliances Achieved?
In order to establish either strategic or non-strategic alliances with communities, organizations and non-profits to support under-represented and marginalized entrepreneurs, the following strategies are key:
(1) Joint Ventures
This requires partnership between the community organization and the entrepreneurs. In doing this, their goals must align with definitive plans and programmes of action.
(2) Sharing of Resources and Leveraging on Expertise
No matter how little, resources could be pooled together in order to drive additional revenues as a team to eventually achieve business targets.
(3) Non-Equity Strategic Alliance
Here, two businesses agree to pool resources together and partner with a non-profit organization to invest in a particular equity or project, with comparative advantage. For example, Plateau state is blessed with arable land for cultivation of various produces. A project baseline could be developed to enhance yield through alliance.
(4) Equity Strategic Alliance
This is where one business owner or entrepreneur purchases a certain percentage of equity from another. It is also called partial acquisition with shared surplus profit by the two businesses. The essence is to strengthen the businesses.
(5) Cooperatives
This is a common strategy whereby the community organization establishes, cooperative organization for businesses that have similar products or services in order to benefit from certain interventions.
It is important to emphasize on what this alliance could generate for the entrepreneurs as follows:
(a) Innovations in business
(b) Increase in brand awareness
(c) New market penetration beyond Plateau state
(d) Economies of scale
(e) Grow revenue of the enterpreneurs
(f) Minimize risks
ROLES OF GOVERNMENT
1. Creating the enabling environment for businesses to thrive in the state
2. Providing security
3. Enhancing appropriate protection of exploitation by middlemen through regulations.
4. Appropriate taxation regime for businesses
5. Supporting ailing businesses where necessary
6. Reducing the risks of businesses such as fire disaster, theft in the markets, and regulating activities of nuisance in the market.
CHALLENGES
The strategic role of government is to mitigate challenges that impact negatively on businesses in Plateau state. However, there are challenges that have been identified, with most of the entrepreneurs and community organizations as follows:
1. Lack of appropriate data and reliable information on the informal business sector and community organization.
2. Inadequate assessment of performance and risk management.
3. Funding gaps and multiple taxation
4. Infrastructural decay and lack of markets in most communities
5. Activities of looters and conflicts.
6. Attitudinal challenges characterized by indiscriminate sale on roads, tax avoidance, drug peddling, etc.
THE WAY FORWARD
As earlier mentioned, H.E., the governor Barr. Mutfwang has started addressing the core challenges confronting businesses on the Plateau. Apart from the infrastructures that he is putting to support the business environment, the following are on-going:
1. Appropriate profiling of businesses and community based organizations with the view of developing a pool of reliable data from government intervention and other positive uses.
2. Minimizing business risks with firefighting equipment and expansion of markets and packing lots while encouraging businesses to do self-risk assessments.
3. Introduction of smart tax system to reduce multiple taxes and make the process flexible and convenient for payment while protecting ailing businesses from collapsing.
4. Evacuation of road side businesses with appropriate plans and programmes for markets and packs.
5. Putting in place a machinery for addressing the menace of drugs and illicit substances which are drives for looting markets and crises.
6. Having stakeholders meetings to generate further ideas and strategies for improving entrepreneurship on the Plateau.
CONCLUSION
Permit me to conclude this keynote by commending the office of the SA on Entrepreneurship, H.E. and all stakeholders for this noble initiative. It is my hope that all of us would work assiduously to ensure that all the under-represented and marginalized entrepreneurs on the Plateau are brought on the economic scale of the state through various supports to develop their businesses. This would not only contribute in reducing poverty amongst our people, but enhance employment in the state. Surely, Plateau shall be the business destination of Nigeria under Barr. Caleb Mutfwang.
Thank you.
