As the devaluation of the naira has the potential to cause losses or profit for Small and Medium Enterprises (SMEs), this year’s BusinessDay SME conference will explore how SMEs can benefit and grow from it. With theme, ‘Impact of naira devaluation on SMEs’, BusinessDay and its team of economic experts have recognised that in the game of currency devaluation there are winners and losers as standard economics teaches that countries that push their currencies down essentially make their exports more attractive to foreigners, thereby becoming natural winners.
However, the structure of the Nigerian economy has certain peculiarities that may prevent the business operators from taking advantage of the opportunities that the currency devaluation presents. So, BusinessDay will, among other issues, examine the strategies for winning the currency devaluation game.
In November last year, the Central Bank of Nigeria (CBN) devalued the naira by eight percent from $1/N155 to $1/ N168, as part of stringent measures to stem the depletion of the external reserves and support the value of the naira. Today, the Nigerian economy is such that the non-oil sector accounts for 86 percent of Gross Domestic Product (GDP), with a thriving productive force of over 34 million SMEs.
These SMEs produce at least 28 percent of Nigeria’s exports (excluding crude oil) but go on to rely on 85percent of imports for the necessary raw materials and intermediate inputs! So, in essence, whatever wins are derived from exporting goods at more competitive prices due to a devalued naira, are immediately lost in multiple fold from imported inputs at a costlier dollar.
The following questions therefore arise: ‘Is Nigeria winning the game of currency devaluation? What is the impact of the naira devaluation on SMEs in Nigeria?’ The third question that would definitely be answered at the forum is, ‘what are the strategies for winning the currency devaluation game?’ These questions and other real issues being faced by SMEs will be the topic of discussion at the 2015 BusinessDay SME forum holding Tuesday, March 17, this year at the Civic Centre, Ozumba Mbadiwe, Victoria Island, Lagos from 9am prompt.
In attendance would be key players in both private and public sectors of the Nigerian economy to tackle the issues. The forum will feature keynote presentations and panel discussions. There will also be opportunity for exhibition of products and services. It is also a forum for sharing of ideas and networking
