…faults over reliance on traditional funding system for MSMEs
…as EU reveals commitment of €1.1bn to AfCFTA implementation
President Bola Tinubu, on Monday, blamed the over-reliance on the traditional funding system of the Micro, Small and Medium Enterprises (MSMEs) in Africa for its low level contributions to the economy, and charged African leaders to evolve stronger ecosystem for the sector to enhance prosperity
This is as the president also predicted that Africa’s future economic success depends on its ability to integrate the informal sector into the formal intra-African trade framework, particularly through the African Continental Free Trade Area (AfCFTA).
According to him, the promise of a better future for Africa does not depend on the skyscrapers being constructed in capitals of nations or the transactions in stock exchanges but lies in the reality that the “potential of the informal sector, which accounts for nearly 90 percent” of the continent’s workforce, must be harnessed.
Tinubu, who spoke through Vice President Kashim Shettima on Monday at the commencement of the 4th African Union Micro, Small and Medium Enterprises (MSMEs) Forum in Abuja, warned that if Africa failed to harness the potential in the informal sector for small businesses to grow, the continent would “keep going round the same cycle of despair.”
President Tinubu also demanded the integration of the informal economy into the fabric of formal intra-African trade, noting that this is the reason why small businesses have remained at the heart of policy formulation in Nigeria.
“Your Excellencies, distinguished delegates, there can be no African prosperity without a strong MSME ecosystem. This forum is a continental call to action. We owe it to ourselves, to our children, and to generations unborn, to integrate our informal economy into the framework of formal intra-African trade.
“I am confident that through our collaborative efforts, this forum will mark a turning point. We hope to see our shared aspirations translated into concrete actions that empower our MSMEs and propel Africa towards a brighter, more sustainable future,m”, he noted.
The week long programme draws participants from across the African continent, as Nigeria continues what expert sees as “appropriate leadership steps to reinvigorate African economy”
Recall that in the last one week, President Tinubu has brought Africans together to restore inter regional and continental trade, starting with the just concluded West African Economic Summit WAES, in Abuja.
These efforts underscore the crucial roles the country can play as the giant of Africa, according to participants at the event.
Highlighting the roles MSMEs play in the development and growth of Africa, the President observed that “beyond employing millions of Africans, they are engines of inclusive growth and effective tools for poverty alleviation.”
He noted that “In Nigeria alone, MSMEs contribute a staggering 48 per cent to our national GDP and employ over 84 per cent of our workforce.
He said the MSMEs mirror the continent’s future, adding that ” this explains why we are deepening our investments to expand the capacity of this sector,”
Beyond building local infrastructure for entrepreneurial expansion, the Vice President implored African countries to entrench cross-border cooperation since their destinies are bound together as a continent.
He identified some of the obstacles confronting MSMEs in Africa to include limited access to affordable finance, describing this particular challenge as a recurring nightmare, just as he noted that with the African Continental Free Trade Area (AfCFTA), there is still hope.
“It costs our continent not just money—it costs us momentum. But we must find hope in the promise of the African Continental Free Trade Area (AfCFTA). This is why I am particularly excited about the theme of this forum—“Building Resilient MSMEs through Digital Innovation, Market Access & Affordable Financing for Africa.” The timing is perfect. The vision is clear,” he declared.
