How Buhari, Osinbajo are empowering MSMES deal with COVID-19 economic aftermath

One of the critical areas of global economy adversely affected by the COVID-19 pandemic is the Micro Small and Medium Enterprises (MSMEs) sub-sector. The Federal government was proactive and reactive in mitigating the impact of the pandemic on MSMEs. At the onset, President Muhammadu Buhari constituted the Economic Sustainability Committee (ESC), headed by Vice President […]

One of the critical areas of global economy adversely affected by the COVID-19 pandemic is the Micro Small and Medium Enterprises (MSMEs) sub-sector.

The Federal government was proactive and reactive in mitigating the impact of the pandemic on MSMEs.

At the onset, President Muhammadu Buhari constituted the Economic Sustainability Committee (ESC), headed by Vice President Yemi Osinbajo, to inter alia: develop a stimulus package and come up with measures to keep the economy afloat in the face of the COVID-19 economic disruptions.

Consequently, the ESC drafted and presented the Economic Sustainability Plan (ESP) which was approved by Buhari.

Embedded in the ESC are copious step by step interventions under the Survival Fund, which made provisions for succour to the MSMEs.

Some of these plans are: Payroll Support-to support 500,000 vulnerable MSMEs in meeting payroll obligations of between N30, 000 to N50, 000 per employee over three months.

Formalisation Support-to provide free CAC business name registration for 250, 000 new businesses.

General Grant-to support the survival of 100,000 businesses most affected by COVID-19 pandemic with N50, 000 each.

Artisan/Transport Support-to provide 333, 000 artisans and transport business operators with a N30, 000 operations grant to reduce the effects of income loss.

Guaranteed Off-take Scheme-for bulk purchase of products from 100,000 MSMEs to protect jobs and livelihoods.

Speaking recently on the interventions, Osinbajo said that the Federal Government remained deeply committed to creating a more business friendly environment for MSMEs to thrive, as they were the engine room of the Nigerian economy.

According to the vice president, the survival of MSMEs is a key component of the ESP.

He said that President Buhari’s approval of the implementation of the MSMEs Survival Fund as part of the ESP was to cushion the impact of COVID-19 on the economy.

“Under the Survival Fund is a Payroll Support Scheme, which will provide up to N50, 000 in monthly salaries for up to 10 staff of a qualifying business, for a period of three months.

“There is also a N50, 000 grant for 100,000 small and medium-scale businesses, while 333,000 self-employed persons working as artisans and transporters will benefit from a one-off grant of N30,000.

“The president has also approved that the Federal Government bear the full cost of business name registration for 250,000 new businesses nationwide.

“We are doing all these to support MSMEs across the country to maintain their staffing levels and keep their businesses afloat through these very challenging times.”

The vice president said the Buhari administration’s commitment to the success of small businesses was evident in its MSMEs Clinics initiative.

Mr Tola Johnson, Special Assistant to the President, Office of the Vice President, elucidated on the small businesses palliatives at the recent inauguration of the Implementation of Survival Fund and Guaranteed Off-Take Stimulus Schemes for MSMEs in Abuja.

The special assistant, who is also the Project Coordinator, said that the schemes would go a long way in mitigating the impact of COVID-19 lockdown on businesses.

“The scheme will be starting with the Payroll Support; the Payroll Support targets 100, 000 businesses; however the number of individuals that will benefit from this is 500,000.

“The next scheme will be the 100,000 MSMEs grants; what the government has done is to say that there a lot of MSMEs that have been affected by the COVID-19 pandemic lockdown; so, what we are trying to do is to very quickly inject N50, 000 each to 100, 000 micro businesses.

“Afterward, there is a N250 CAC free registration; it is free for the MSMEs, but the government is paying the CAC for this.

“So, what the government has done is to say to the CAC, you do this regularly with the MSMEs at about N12,000 or there about; give it to us at half price, we will give it to the MSMEs free.’’

He said that under the National MSMEs Clinic, the vice president and the Minister of Industry, Trade and Investment have been to no fewer than 26 states.

Johnson said that in the course of the clinics, it was discovered that very creative businesses were not registered.

“They will tell you they don’t have N10,000 to N12, 000 to register their businesses.

“So, the government had promised that at some point, we will assist, I think the opportunity has come now; the opportunity cannot be better than now.’’

He said that under the Survival Fund, the last strap would be the Transport and Artisans Support.

According to him, no fewer than 333,000 beneficiaries will get a one-off N30, 000 grants, adding that the government will be working with associations, individuals and the Ministry of Transportation to implement the scheme.

“After that, we move to the Guaranteed Off-take; we will be rolling out the schemes weekly; we plan to do that for four weeks in a row, if we can, and God permits, put a smile in the face of MSMEs across all board; that is our plan; if things change, we will let you know.

“We are working with states because we do not want to get to a stage where the states will say how come 35,000 people are benefitting from our state and we do not know,’’ he said.

Johnson said that the website for the Survival Fun is www.survivalfund.ng.

On her part, Mariam Katagum, Minister of State for Industry, Trade and Investment, said that the two schemes were targeted to impact about 1.7million entities and beneficiaries across the country.

According to her, the MSMEs Survival Fund is a special grant to support vulnerable MSMEs in meeting their payroll obligations and secure jobs from the shock of the COVID-19 pandemic.

She said that the scheme was estimated to save nothing less than 1.3 jobs across the country, while targeting an average of 35,000 individuals per state.

Katagum said that under the Guaranteed Off-Take, it was expected that about 300,000 jobs and 100,000 MSMEs would be saved by guaranteeing off-take of priority products.

The minister said that N75 billion will be put into the interventions.

Sharing similar sentiments at the event, Mr Okonkwo Obadigbo, a representative of the Orgamised Private Sector, described the administration of President Muhammadu Buhari as a true friend of MSMEs.

He said that since 2015, the policies of the current administration had been favourable to MSMEs in spite of security and infrastructure challenges.

“A true friend is that person who has your back when times are good and when times are tough.

“In my humble opinion, this Federal Government of Nigeria led by President Buhari, since 2015 has been a good friend of MSMEs.

“Notwithstanding the challenges of insecurity and infrastructure, MSMEs have benefitted from many policies implemented by the Federal Government.

“The Secured Transactions and Moveable Assets Act of 2017 established a national collateral registry which has eased the requirement from MSMEs in assessing bank credits.

“The Bank of Industry (BOI) and the Central Bank of Nigeria (CBN) have executed several programmes and intervention funds for MSMEs in Nigeria.

“The Finance Act of 2019 reviews the taxation of MSMEs,” he said.

The portal for the registration of prospective beneficiaries for the Survival Fund opened at 10 p.m. on Sept. 21.

According to the Project Delivery Office, the portal will have educational institutions as the first category of beneficiaries to register.

“Nigerians interested in the Payroll Support scheme are to note that the site for registration will be open at 10 p.m. on Sept. 21.

“In order to ensure seamless registration process, the Project Delivery Office, has designed a registration schedule.

“Registration for Payroll Support will start with educational institutions on Monday and will be followed with businesses in the hospitality industry on Sept. 25 beginning at 12 a.m.

“The portal will also be open to other category of small businesses from 12 a.m. on Monday Sept. 28.”

Small businesses, indubitably, are key drivers of economic growth; hence, keeping them viable should be given great attention.

Chijioke writes from (NANFeatures)