According to the SMEDAN National Policy on MSMEs, Micro, Small and Medium Enterprises (MSMEs) are broadly defined as businesses with staff that are less than 200 employees and turn-over of less than NGN1bn. According to the International Council for Small Businesses, MSMEs makeup over 90% of all businesses and account for an average of 60% to 70% of total employment and 50% of the Gross Domestic Product (GDP) of any economy.
This mapping covered over 110 instruments but those that were considered worthy of some level of analysis in this report are 94. These include 10 general policies and intervention programmes, 10 crop/product specific policies and intervention programmes, 58 laws/regulations/guidelines, and 13 Bills divided into themes that reflect the different issues that affect the competitiveness of MSMEs.
The report also examined the impact of Nigeria’s trade obligations under ECOWAS (ETLS and CET), the WTO, and the yet to be operationalised AfCFTA. Some of the key findings of the mapping are highlighted below.
On Policies and Special Intervention Programmes:
• Most of the policies reviewed are well articulated. However, they are either abandoned or poorly implemented. There are also the cases of different MDAs having similar but poorly coordinated policies or even one MDA having several policies. Many policies and laws affect the competitiveness of MSMEs in Nigeria, but implementation has not been consistent. Policies are abandoned without formal repeal and replacement. For example, the NIRP has been largely abandoned even before 2019 which was the year it lapsed. Yet, there is no formal pronouncement from the government on the fate of the Plan. None of the Policies reviewed has been consistently implemented.
• The culture of policy monitoring and periodic evaluation is lacking in the public sector. Most policies are implemented (inconsistently) over a long period and then abandoned. This denies the country an opportunity to understand whether policies are succeeding or failing at achieving their goals. As a principle, it is proposed that every MDA should take stock of all the policies and programmes under its remit with the view to review, discard, and update or consolidate as the case may be. It seems that it would be easier to track performance when each MDA has a strategic plan that spans at least five years. The plan would set out the goals/targets of the MDA for the period as well as include a monitoring and evaluation plan which would be used to assess the performance of the head of the agency regularly. Any modification to the plan would require rigorous justification. Every policy/programme of the MDA should derive from this plan. It is only a disciplined approach to policymaking and implementation that could advance the development of the country.
• The MSMEs have not been active in contributing to policymaking and implementation processes due to a combination of reasons. The lack of strong organisational capacity as well as the capacity to conduct analysis and make an evidence-based contribution are key constraints. This does not only affect the ability to advocate or lobby for favourable policies and laws but also the ability to provide independent tracking of the actual implementation of policies and laws.
• The import substitution orientation of successive administrations through which government picks products or crops to support has resulted in the relegation of crops with huge export potential, such as ginger. The process of selecting the industries or crops to support is not always based on economic considerations. Strong lobby groups and political considerations play an important role.
On Existing laws and regulations:
• The mapping found that most of the laws impacting the operations of MSMEs are obsolete or create overlapping and sometimes conflicting mandates on different agencies over the same issues. Some of the obsolete laws include the Hides and Skins Act enacted in 1942, the Produce (Enforcement of Export Standards) Act enacted in 1959, and the Customs and Excise Management Act which was enacted in 1958.
• On general quality and standards regulation, the overlapping mandates of NAFDAC and SON are still an issue mainly because the agencies have not devised an effective cooperation mechanism. Furthermore, conflicts exist between NAQS and NAFDAC about the regulation of certain chemicals that are used in farming.
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