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How Entrepreneurship in Nigeria Alleviates Poverty

Entrepreneurship in Nigeria
Located in West Africa, Nigeria is one of the poorest countries in the world. The Federal Government of Nigeria, through a report by the National Bureau of Statistics in 2022, reported that 133 million Nigerians are multidimensionally poor. This accounts for about 63% of the country’s total population. Many cannot afford to fund their basic and essential needs and struggle to make a living every day.

One fundamental cause of poverty in Nigeria is the lack of employment. In March 2022, Professor Idris Bugaje, the Executive Secretary of the National Board for Technical Education (NBTE), reported that about 90 million Nigerian youths are unemployed. Many Nigerians do not have an education which makes it challenging for them to obtain jobs. Without employment, people often cannot be financially secure or meet basic needs. Currently, there are about 159 polytechnics and 221 universities in Nigeria, which produce up to 500,000 graduates every year with no jobs in the labor market. There are not enough job opportunities in the country even for those who have an education. However, entrepreneurship in Nigeria has proven to be effective in the reduction of unemployment.

Entrepreneurship in Nigeria

Through Micro, Small and Medium Enterprises (MSMEs), entrepreneurship in Nigeria has contributed immensely to the economy. In fact, Vannesa Lerato Phala, the Country Director of the International Labour Congress said at the opening session of a workshop that took place in November 2022, at Abuja, that “In Nigeria, SMEs contribute 48% of national GDP, account for 96% of businesses and 84% of employment. This sector contributes significantly to alleviating poverty and increasing job creation.”

Entrepreneurs create employment opportunities for themselves as well as for others. Entrepreneurship in Nigeria impacts the country’s economic growth by bringing new products, techniques and processes to the market and also extensively increases productivity and competition amongst producers of goods and services. Many Nigerians now possess at least one entrepreneurial skill with which they are able to sponsor the lifestyle they wish to live. The government has helped increase awareness of the importance of entrepreneurship in Nigeria by introducing entrepreneurship studies as a compulsory course in higher institutions and establishing and supporting some programs that promote skill acquisition. Here are three entrepreneurship programs promoting entrepreneurship in Nigeria.

3 Entrepreneurship Programs Promoting Entrepreneurship in Nigeria

  1. The Youth Entrepreneurship Development Programme (YEDP): YEDP launched on March 15, 2016. It aims to promote resourcefulness by providing capital to youth entrepreneurs and start-ups that often face problems of inadequacy and high costs. Target beneficiaries of the program are graduates who are members of or have completed their service with the National Youth Service Corps (NYSC) after five years or less or those who possess a verifiable tertiary institution certificate. Beneficiaries also include artisans with a First School Leaving Certificate or a technical certificate or accredited proficiency certificate from the National Board for Technical Education (NBTE).
  2. The Development Bank of Nigeria (DBN) Entrepreneurship Training Programme: The Development Bank of Nigeria has aimed to reduce the constraints that MSMEs face in Nigeria by providing loans and risk management tools. The DBN Entrepreneurship Training Programme began in 2019 to implement MSMEs with the prerequisites necessary for business growth and success. The training is usually open to business owners who are 18 years old and above, and are legal citizens of Nigeria.
  3. FGN Special Intervention Fund For MSMEs (National Enterprise Development Programme): This is an initiative of the Federal Government of Nigeria targeted toward the provision of subsidized loans to MSMEs with 9% interest only. In order to promote and encourage the impact of MSMEs, which are engaged in manufacturing and agro-processing, on the economy of the country, the Federal Government of Nigeria established the Special Intervention Fund in 2015 to give funds necessary for local raw materials. With this program, SMEs can receive funding of up to 20 million Naira, for people to pay back with only 9% interest per annum.

Looking Ahead

With so many skills that entrepreneurs in Nigeria engage in, they have slowly proven to be the major drivers of job creation, wealth creation and industrialization. By promoting entrepreneurship in Nigeria, the government encourages those who are underprivileged, and without funds, to go ahead and pitch their business ideas for funding, this has resulted in significant progress in the country’s economy over the years.

– Oluwagbohunmi Bajela
Photo: Flickr