ROLE OF GOVERNMENT ON SMALL AND MEDIUM SCALE ENTERPRISE IN NIGERIA

CHAPTER ONE

1.0 INTRODUCTION

1.1 BACKGROUND TO THE STUDY

Small and medium scale enterprises are sub-sectors of the industrial sector which play crucial roles in industrial development (Ahamed, 2006) following the adoption of economic reform program in Nigerian 1981, there have been several decisions to switch from capital intensive and large scale industrial projects development to small medium enterprise which have better prospects for developing domestic economy, thereby generating the required goods and services that will propel the economy of Okigwe Local Government Area towards development.

It is based on this premise that (Ojo, 2009) argued that one of the responses to the challenges of development in particularly Okigwe Local Government Area, is the encouragement of entrepreneurial development scheme.

Despite the abundant natural resources, the country still finds it very difficult to discover development bearing since independence. Quality and adequate in infrastructural provision has remained a nigh-mara, the real sector among others have witnessed downward performance while unemployment rate is on the increase. Most of the poor and unemployed Okigwe indigenes in order to better their lots have resorted to establishment of their own business.

Consequently entrepreneurship is fast becoming household name in Okigwe Local Government Area. This is as a result of the fact that the so called white caller jobs that people clamour for are no longer there. Even the well known to be the largest employer of labour are on t he down turn following the consolidation crisis and fraudulent practices of high and might in the banking sector.

The companies of course are folding up as a result of erratic power supply, insecurity and persistent increase in interest rate which has lead to high cost of production and undermines profit making potentials of companies operating in Okigwe Local Government Area. As a result of banking sector practices and continuous folding up of companies a lot of Okigwe indigenes are thrown into unemployment which inevitably determine the economic situation of the country. Since the office jobs that people desire are no longer there for the teeming populations and the few ones that succeeded in getting the jobs are thrown out as a result of the factors identified above, the needs for the government and the people to have a rethink of the way out of the mess becomes imperative.

Hence the need for small and medium scale enterprise (SMES) becomes a reality as a mean of ensuring self independence employment creation, import substitution, effective and efficient utilization of local raw materials and contributions to the economic development of Okigwe Local Government Area. All the afforested benefits of small and medium scale enterprises cannot be achieved without the direction intervention of the government and financial institution.

Over the years, a number of polices have been formulated by t he government with a view to developing small and medium scale enterprise. The Nigerian government under the leadership of Chief Olusegun Obasanjo promulgated micro finance policy and other regulatory and supervisory framework in 2005. This paper will therefore examine several policies aimed at developing small and medium scale enterprise vis-à-vis roles planted by the government and financial institution in achieving SMES development in Nigeria generally and in Okigwe Local Government Area in particular.

1.2 STATEMENT OF THE PROBLEM

In recent past most small and medium scale enterprises have folded up or crumbled. Today because of lack of growth strategies for long-term actualization of their goals or strategies without taking into consideration the long term benefit and future of the firms. Lack of creative and innovation business ideas and undeveloped entrepreneurship culture and limited understanding to modern production technology, marketing and business techniques makes their strategies to fail.

The reason why small and medium scale enterprise loses their customer relationship or remain stagnated is because there is no sound strategy laid down for good customer relationship and firms image. Some business enterprises have sound strategies but do not know how they can be effectively applied. Administrative problems was identified in the year 2015, thirty achievement of Goodluck Jonathan administration, (1 year ago). The officials Nigeria have started discussing prospective candidates, Nigeria’s unity and performance of the current president Goodluck Jonathan administration. The official campaigning the 2015 general and presidential elections in Nigeria starts soon. Already, Nigerians have started discussing prospective candidates, Nigeria’s unity and performance of the current president Goodluck Jonathan administrations. The Goodluck Jonathan administration has been charged with the leadership of large and diverse entity that is Nigeria, Mr. Nwawetanma starts in the four years that the Goodluck Jonathan administration has been in power, there have been flaws, successes and giant leaps.

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