SURVIVING COVID-19: WHAT IS THE HOPE FOR NIGERIAN SMEs

Following the outbreak of the COVID-19 pandemic, a lockdown of three major states (Lagos, Abuja and Ogun state) was implemented by the Nigerian President on the 31st of March, 2020 at 11:00 PM, in a measure to reduce the spread of the COVID-19 in the Giant of Africa. This lockdown will stay in place for at least two (2) weeks, as announced by President Muhamadu Buhari.

So far, it is Day 8 and citizens have been fairly compliant even though there have been some cases of non-compliance. As a result, a lot of businesses and offices have adopted the “work from home” method. However, not all businesses can adopt this especially businesses that require sourcing for raw-materials or processed goods from markets or importation of these raw materials and/or processed goods.

Nigeria is packed with entrepreneurs; ranging from petty-traders, micro-businesses, and small businesses. These businesses would easily take the full hit of the economic effects of the COVID-19 pandemic. The lockdown has halted business activity globally and Nigeria is not an exception. It is not certain how long the economy would need or take to bounce back from this. The uncertainty of the duration of the lockdown has created unrest amongst small business owners, as the lockdown has slowed, and in some cases, totally crippled business activity.

Business owners are still covering finances like paying rent (for the office) and paying wages to staff. This may result in the closure of businesses, dry-up of funds and letting employees go. According to the President of the Association of Small Business Owners of Nigeria, Femi Egbesola, members are worried and scared.

There has been general concern about those that live under the poverty line, those that feed from hand to mouth, and those that live based on day by day income. How do they comply with this lockdown without adequate provision for them by the government?

Although donations have been made from the private sector to aid the Nation’s effort in fighting the spread of COVID-19 and generally helping the average Nigerian during this pandemic, the money is yet to trickle down to business owners. As at the time, nobody is yet to confirm receipt of funds.

However, few have received food materials from the Emergency Food Response in Lagos state and this has caused a general hysteria as those who have received claimed that the food stuffs were not enough and should not be given to an adult. This was backed up by videos and pictures of the food items.

On the 7th of April 2020, the President approved the withdrawal of $150m from the Sovereign Wealth Fund for distribution to the three arms of government. At a media briefing on the fiscal policy measures to combat the spread of COVID-19 and how the disease has impacted the nation’s economy, the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, mentioned that the withdrawal was as a result of the drop in revenue on the federation account and this has affected the amount distributed to the arms of government.

She also mentioned that the Nigerian government will soon need aids from the World Bank and International Monetary Fund (IMF) among others to request for additional funds in the battle against the pandemic.

The government, however, is yet to announce its relief plans, if any, for Nigerian small business owners during this COVID-19 pandemic.

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