Nigeria’s First Lady, Senator Oluremi Tinubu, recently spoke at a gathering of the Renewed Hope Initiative in Abuja, where she shared some inspiring words with grant beneficiaries. She said that getting out of poverty doesn’t have to be about having a lot of money. According to her, starting a small business, like selling Akara, roasting corn, or making kuli kuli, doesn’t require a big investment or injection of capital at a very pricy and exorbitant rate predominant within the Nigerian economic landscape circa 35 percent. What’s more, the First Lady explained that the beneficiaries didn’t receive loans, but rather grants, which is a significant difference. This approach, she believes, can give people hope and help them improve their lives. By providing grants instead of loans, the initiative aims to empower individuals, especially those who may not have access to traditional funding sources. The idea is to support small-scale entrepreneurs and help them grow their businesses, no matter how small they may seem. As Senator Tinubu pointed out, even a small venture like selling Akara or roasting corn can make a big difference in someone’s life, and it’s a step towards creating a better future.
The video spread quickly, as things like that often do. Some people criticized the government, saying they were out of touch with how much things cost. Others, including some in the government, argued that there was nothing wrong with starting a business small, that selling akara, agbado and kulikuli was just the beginning – a way to learn about running a business, being disciplined, and growing. But both sides, despite having their strong points, are missing a valid point. The problem with small businesses in Nigeria isn’t that they start small, because almost every successful business starts that way. The problem is that in Nigeria, small businesses often stay small. The woman selling akara is still selling akara at the same corner, the man grilling suya is still out at the junction till 1:00 am, for the same low profit, ten years later. He or she is not failing because they are not working hard enough, but because the economy is designed to keep them in the same place.
Valid dignity of labour without pivot structure
I want to give the First Lady a fair chance before I present my view on her position on the subject matter under discussion. There’s something to be said for the informal trade that keeps this country going, and I think grants are a more compassionate way to help people than loans. She also talked about some real money that’s been committed to important causes through her office – ₦2 billion to fight tuberculosis, ₦1 billion for breast cancer, and ₦0.5 billion to tackle malnutrition. These are significant amounts, and they don’t deserve to be mocked or belittled. The First Lady seemed sad that the conversation has shifted to blame the ordinary person, when really, they should be the ones who have hope. She said, “The narrative has really changed, to challenge the average man, whereas the average man is supposed to have hope.”
Having hope is one thing, but it’s not a plan for how to make things better. And just giving someone enough money to buy a frying pan and grill stand isn’t going to help position Nigeria as a great industrialist hub for sustainable global innovation. When the President’s wife talks about our big economic goals and only mentions simple things like roasted corn, it’s not mean-spirited. She’s actually showing us the limits of what the government is trying to do and then asking poor people to be thankful for the little they have. This is what happens when you give up on the hard work of helping businesses succeed and instead focus on small, easy things – it’s like having an economy based on akara, kulikuli, suya and agbado traditional recipes. It’s not a real solution to our problems.
Future value of present numbers not scalable for global relevance
Let’s take a closer look at what these small businesses mean to Nigeria. A recent national survey conducted by the Small and Medium Enterprises Development Agency and the National Bureau of Statistics reveals that there are over 39 million micro, small, and medium enterprises in the country. These businesses make up a staggering 96.9 percent of all businesses in Nigeria, providing employment to nearly 88 percent of the population, and contributing between 46 percent and 48 percent to the country’s gross domestic product (GDP). This is not just a minor aspect of the economy – it is the backbone of Nigeria’s economic structure. If you were to remove the oil industry and the financial services from the equation, you would be left with a country that is primarily driven by the informal players consisting of traders, artisans, processors, and small-scale entrepreneurs. These individuals are the ones who are truly powering the Nigerian economy, and their contributions cannot be overstated.
If you take a closer look at the numbers, you’ll see that most of these small businesses are really tiny – like the person selling akara, kuli-kuli and agbado on the street corner or the kiosk where you can withdraw or top up your phone and utility bills on a POS machine. They usually just have the owner and maybe one other person helping out. What’s really missing are the medium-sized businesses that can hire a lot of people, do their accounting properly, business management, tax remittances, disruption management, and even export goods to deliver a net surplus. These kinds of businesses are hardly found at all. So, it’s not that the small business owners aren’t trying to grow, it’s just that the opportunities for them to move up are not there – it’s like the ladder to success has been cut off mid way, leaving them with no way to climb.
Mai shayi does not have flavoured tea from his plantation
If you ask a Nigerian business owner what’s holding them back, they won’t say it’s because they don’t have enough work to do. The real reasons are more complicated. For one, it’s hard to get the money they need to grow, and when they can, it’s expensive at over 30 percent. Then there is the problem of not having a reliable source of power, which makes it tough to get anything done as the machines, plants and equipment will not just eat kuli-kuli. The value of the Nigerian currency can be unpredictable, making it hard to plan for disruptions in standard of living of which a classical example is the sporadic increase in accommodation and logistics rate. On top of that, following all the rules and regulations can be a real challenge, and it costs a lot to do business on a large scale. All these issues combined make it difficult for businesses to thrive.
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Oluwatosin Oladetan, (MBA, ACCA, PMP, FMVA, BIDA, MICBC, CNSS, SPY-SP, NIM, TRCN), a vice president (finance), public policy expert, corporate and business strategist, independent director, trusted advisor, is a Volunteering Contributing Analyst with Business a.m.Â
Akara, Kuli-kuli, Agbado sour in face of inadequate capital (1)