UK-based Nigerian entrepreneur advocates strengthening PPP to drive SMEs
Mr Francis Agbeja, a Nigerian entrepreneur based in the UK, has called for strengthening of Public Private Partnership (PPP) arrangement to drive Small and Medium Enterprises (SMEs) in Africa.
Agbeja, the Director of Daffresh Freight Services Ltd., gave the advice during a phone interview with the News Agency of Nigeria (NAN) on Monday in Abuja.
He said such partnership was crucial for any SMEs to acquire or absorb innovative technologies to perform maximally.
Agbeja said that the SMEs sector of any country was expected to drive the economic growth by offering significant opportunity for investors to contribute in the future of a country.
“Small and Medium Enterprises (SMEs) are an integral part of any economy and play a vital role in supporting a stable economic environment.
“They are crucial in upholding the growth and existence of economy, especially developing countries in Africa.
“ SMEs are driven by combined efforts of private entrepreneurs, government and financial institutions.”
According to him, one of the key elements for SME’s success is access to finance.
He observed that SMEs usually found it difficult to achieve financial resources for building up of their businesses in many developing countries.
The director added that SME’s expansion to global markets or association with other firms was also related to the availability of finance.
“Usually, SMEs find it difficult to avail credit or equity. Even maturities of commercial bank loans offered to them are limited to a very short period.
“In the same way, lower interest rates are extended to a very few companies.
“SMEs are often considered to be high-risk borrowers because of insufficient assets and their vulnerability to market fluctuations, he said.
He said banks turned out to be the biggest supporters of SMEs, however, added that banks would also benefit commercially from lending to SMEs.
Agbeja said SMEs could merge with other firms to complete their fund requirements.
According to him, mergers also provide SMEs opportunity to enter into international markets and form strategic alliances to expand their business and enter new productions.(NAN)