E-Business
The Role of the Government in Supporting SMEs for Economic Growth

By Adewale A. Adeyipo
The Government at various levels has in one way or the other focused on the performance of SMEs for economic gains and growth. While some Government in developed economies like the US & China had formulated policies aimed at improving and empowering the growth and development of the SMEs.
In China, State Owned Enterprises (SOE) were transformed into small and medium Non-SOEs, which provided an opportunity for more SMEs to be established in China. This approach of Non-SOE promotion policy led to the development of more SMEs, which contributed to China’s economic growth.
They make up over 99% of all enterprises in China today, while the output value of SMEs accounts for at least 60% of the country’s GDP and generates more than 82% of employment opportunities in China. (According to China Statistical Yearbook).
However, other Government focus on assisting SMEs to grow through soft loans and other fiscal incentives to promote the socio-economic development of the country like poverty alleviation, youth unemployment, human capital development, and improve the social welfare of the people.
For example, in China, the World Bank offered support through enhancing access to finance for underserved micro and small enterprises with US$100 Million in IBRD financing, including both lending and technical assistance. Before the project began, about 20,000 micro and small loans were disbursed to MSME clients in 40 branches per year, but by the project’s completion at the end of 2010, more than 60,000 loans were issued in a year — tripling the supply of credit to small businesses. Over three years, US$2.3 billion in MSME loans were distributed through recipient Chinese financial institutions.
The Bigger Problem
Nigeria’s population, according to the UN, stands at approx. 200M with a median age of 18, which implies the Nigeria youth represents 42.54% of the total population. According to Trading Economics, the unemployment rate in the last 5 -10 years has continuously grown by 4% and was 23.1% as at the previous report generated in Q3 of 2018.
Also noteworthy is the fact that approx. 500,000 youths graduate yearly with 47% of these graduate’s unemployable (Jobberman Reports). The Government is consistently finding it challenging to match the skills of these graduates to the available jobs in the market which in turn puts more pressure on the nation’s dependency rate of 88.2% (Trading Economics).
One may suggest that to address this employability gap and high dependency rate is to engage our technical schools actively and also revisit the curriculum of our institutions. Many have argued on the suitability of the faculties responsible for transferring knowledge to the students in today’s VUCA world. Not so much about the technical understanding of it, but more on the practicality of the same knowledge outside the walls of the classrooms.
Sadly, the fact is that these institutions are not enough and ill-equipped. While the Government has only been able to establish 156 approved technical schools (NBTE Reports) across the 36 states with an average of 4 technical schools per state, these statistics show that the technical schools available can’t match the current population of Nigerian graduates (500,000/year).
How then can we engage unskilled laborers when providing jobs for graduates is still a major challenge? Can the Government establish more technical schools to accommodate the skilled and unskilled? (That’s a discussion for another day).
The World Bank has estimated annual growth of 2.6% of the Nigerian population, while the unemployment rate was recorded to be at 23.1% in Q4, 2018. Trading economics predicted that there will be a 4% YOY in unemployment in Nigeria. The math is simple; if all variables remain constant, the 4% YOY increase in 6 years would have resulted in an unemployment rate of 29.02%. This scenario would lead to an increase in crime rate, political instability, exploitation of labor, increase in poverty, and social problems.
However, one of the quickest solution to this futuristic problem of unemployment is to integrate SME skills program as a curriculum in our early years of schooling, build more technical schools to reduce dependency rate, improve on existing infrastructure (good road, rail network & power generation), encourage more public-private partnership policies, introduce policies that guides SMEs to excel.
The Nigerian Government through her many agencies like the NIPC, SMEDAN, and FIRS can enhance their engagements with the MSMEs, and also create central policies where SMEs are allowed to showcase their products/services and sell to the global market while ensuring adherence to the international standard.
It is quite important to note that the financial sector also plays a significant role in the sustainability of SMEs as they are a major player in providing loans to SMEs. Just as reported by Techpoint, Oyapay, a Fintech start-up company, shut down due to a case of a family investment gone wrong. This approach shows that Start-ups often depending on family members as a source for funding, isn’t a sustainable model.
Technological Innovation
In spite of globalization, an important section of developing countries’ SMEs operationalizes business the conventional way. This results in a low level of productivity, low-quality of products, and exploring to a small and local market. It is noted that generally, SMEs tend to have low productivity and as a result, are weak when competing.
This is the result of using conventional technology and not having the maximum utility of machinery. Due to the limitation of funding and innovation, it may not be possible for them to improve their processes. However, policies can be implemented to guide SMEs on adopting the use of technology.
Infrastructure (Road, Rail Network & Power)
Poor infrastructure is a major frustration for SMEs trying to get on with their jobs; be its poor-quality broadband; it is stopping a small business from operating more online or rural firms finding it harder to move around because of poor roads and public transport.
Poor and deteriorating infrastructure can pose severe damage on business growth and viability, hence the lack of such amenities has led to extremely high cost of operating businesses in Nigeria. Other factors like; cost of sourcing for raw materials, transportation, internet services and finished products all add up, often leading to the provision of poor service delivery rendered to customers just for the business to keep afloat and possibly break even.
Thus, adequate and basic infrastructure can act as a catalyst for economic growth beyond the usual ease it provides. A good example is the establishment of the IPP project launched at Sura-Shopping Complex, Simpson road in Lagos Island. A project handled by Rural Electrification Authority under the Office of the Vice President of Nigeria. The initiative was very basic, focused on providing regular and reliable power supply to the over 1,000 shops and offices within Sura-Shopping Complex.
Upon the commencement of this project, it was observed that beyond the power supply, more jobs were created due to an uninterrupted power supply at the complex. The offices and business owners could almost immediately afford to employ more hands, do shifts (including night shifts) for more production. Initiatives like this would further encourage SMEs and as well as improve our ease of doing business index.
Workable Models for SMEs Funding
One viable model I have seen is the way some of the Micro Finance Institution dispense loan. The Group-lending model requires individuals to form a group of five and receive five-days financial training to obtain a loan from the lending Institution.
The emphasis from the very outset is to strengthen the SMEs organisationally and to build their capacity to plan and implement micro-level development decisions. (Grameen Group Lending Model).
The Government can thereby adopt this approach and provide loan to a group of different clusters of SMEs based on their demographics, business type, location and the raw materials required to run those businesses. Other lending models can also then be adopted here.
Many would say such initiatives will not be successful in Nigeria going by the previous experience of bad debts, unaccountability, lack of adequate records, and poor or lack of identity management systems. My assumption is the same, however, one begs to wonder if the community lending Initiative could make a difference which allows one to be responsible for another?
For instance; one can only qualify for loans if my fellow community members are fruitful in the commitment to repayment. Then there is bound to be an exponential growth in the SME sector when each member depends on another to grow. Currently, for some of the micro-finance companies – these clusters can only qualify for a bigger loan after repayment.
In my days in the FMCG sector, working at the production line, a bonus is received when targets are met as a group and not as individuals. As the goals are met as a group, this qualifies the group to be engaged with a bigger task as they continue to grow as a unit. Is this method applicable to the SMEs?
The TraderMoni initiative, for example, is focused on providing loans for petty traders that are unbanked but require access to funds to run their small businesses. Corporate Finance Houses might not be able to capture these set of the population due to their locations, lack of interest to own a bank account or the knowledge gap on why being financially included is vital to them.
TraderMoni can advance to the next stage on requirements where traders would only qualify for their next loan when they have successfully registered a bank account to their name through USSD service. Would such an initiative improve financial inclusion? I believe so.
Government Agencies like the SMEDAN; are responsible for initiating and articulating policy ideas for small and medium enterprises growth and development. If they further enrich their database, FDI inflows may grow based on credible and available data showing the opportunity for growth.
The Government’s form of supporting SMEs doesn’t necessarily have to be financial support all the time; as Government can even lease equipment to a group of farmers in community X as a service for five years. This support would promote the effective use of these equipment’s and drive more farmers to make the best use of the time allotted to them.
NISRAL, a CBN initiative founded in 2013 currently executes the equipment-as-a-service model for farmers in rural areas. The major advantage with this initiative is that every member of such a group depends on each other to ensure the funds being received are used for its real purpose while profit generated is channeled back into the business.
SMEs in Nigeria
In Nigeria, the importance of SMEs in the process of social and economic development cannot be neglected, and its significance in the development of the country.
It was summarized in Nigeria’s third National Development Plan, 1975-1980; as the generation of employment opportunities, stimulation of indigenous entrepreneurship, facilitation of effective mobilization of local resources including capital and skill as well as a reduction in regional disparities.
Despite the slow growth of SMEs development, Impact of SMEs has been a known fact dated back as 1975!
The Small Business and Entrepreneurship Council (SBE Council) statistics revealed that 99.7 percent of U.S. businesses are SMEs. However, there are several barriers that the US SME sector still faces, especially in commodities.
The significant barriers to trading include insufficient access to finance, high transportation costs, tax laws, and rules, maintaining profitability, developing new products, language, and cultural differences. Gaps like these signify no SME ecosystem is perfect, and they are required to keep evolving with time as new challenges arise. Despite the challenges in the SMEs market in the US, the sectors still contribute 47% of total employment.
While in developing economies like India, the contribution of the SME sector to manufacturing output, employment, and exports of the country is quite significant. It is noted that regarding the value, the SME sector of India accounts for 45% of the manufacturing output and 40% of the total exports. India’s SME sector employs around 42 million people in over 13 million units throughout the country. (Source: Department of Commerce, Govt. of India)
Conclusion
It is evident from my article that SMEs contribution is considerably high in economic development whether it is a developed country or developing country. Not only financially subsidized promotion is essential, but the strategic implementation becomes vital for sustainable development of the SME sector. Strategic implementation takes care of financial aspects, human resource, marketing, research and development, technology, and corporate governance in the SME sector.
SMEs in developed Nations are not only relying on Credit availability but Technological Innovation and Infrastructural Policies. Hence, it is critical for Policymakers to create an enabling and sustainable environment as a bedrock for SMEs to flourish. Great to recall the words of Richard Branson; “A business starts small”.
Adewale A. Adeyipo, Ag. Group managing director, CWG plc,
E-Business
Africa Tasked to Fast-track AI Skills Development

Africa has been urged to fast-track the development of Artificial intelligence (AI) skill to benefit from its economic value. AI could contribute $1.5 trillion to Africa’s economy by 2030 if the continent secures 10% of the global AI market, according to SAP, which sourced the statistic from online media.
However, a shortage of AI talent, with the need to retain cyber security and cloud skills, threatens to block opportunities to monetise growth.
This is part of a report released by SAP: ‘Africa’s AI Skills Readiness Revealed’, which reveals that African organisations are rushing to enhance their traditional IT skills base in the wake of accelerating adoption of AI.
The report adds that while 94% of organisations offer monthly AI training, none currently allocate more than 10% of their HR or IT budgets to skills development, a sharp decline from 2022.
Genevieve Koolen, HR director at SAP Africa, said: “There is a near-universal need for AI-related skills among African companies this year. Since traditional IT skills such as cloud and cyber security related competencies remain in high demand, companies now face the dual challenge of attracting and retaining traditional tech talent while also building greater AI competencies within their businesses. It is unsurprising then that most African organisations provide career development opportunities for employees with AI specialisations.”
The report reveals that all companies surveyed expect the demand for AI skills to increase in 2025. Nearly half said they expect a ‘significant’ increase.
Koolen added that while there is an urgent need for policymakers and education institutions to fast-track AI skills development initiatives among Africa’s swelling youth population, companies also face pressure to equip existing workers with future-ready skills.
“Thirty-eight percent of companies surveyed said reskilling of employees is a top skills-related challenge for them in 2025, and nearly half said the same of upskilling. The impact of these changes creates its own challenges, as evidenced by the two-thirds of companies that said helping employees understand why reskilling is necessary is a top priority.”
Research also showed that African organisations are alive to the possibilities presented by AI-related innovation, with companies citing perceived value in improved decision-making (64%), marketing capabilities (51%) and innovation (47%) enabled by AI.
However, poor access to AI-ready skills is already causing negative impacts among the same companies, including failed innovation initiatives, delays completing projects, greater pressure on teams and an inability to take on new client projects.
“Organisations are rising to this challenge by increasing the frequency of training offered to employees, with 94% saying they offer training at least monthly,” said Koolen.
However, the latest data indicates a drop in the allocated budget for skills development.
In a previous survey conducted in 2022, a quarter of organisations said they spend more than 15% of their HR or IT budgets on skills development and training. This year, not a single organisation that formed part of the research spent more than 10%.
SAP lists several measures that companies can implement to ensure they cultivate the correct skills mix:
Be prepared: With universal demand for tech and AI-related skills and an ongoing skills scarcity, African organisations must prepare for a shortfall in critical AI-related skills this year.
“The moment calls for a pragmatic approach that combines longer-term skills development – including reskilling and upskilling – with short-term measures that alleviate some of the immediate pressures and creates space for more robust skills development initiatives. Organisations also need to take care to support employees through this uncertain period, for example, by using human capital management technologies that help HR teams identify concerns.”
Prioritise training: Koolen said it is surprising that budget allocations for training and skills development appear to be shrinking. “Too many digital transformation and innovation initiatives fail to deliver the expected business value due to a lack of appropriate skills.
“In light of the rapid pace of technological advancement, any organisation that fails to invest in skills will likely find they are unprepared and unable to leverage new innovations. In time, this will erode their competitiveness and lead to significant impacts to the bottom line.”
Instead, organisations should place skills development at the core of their business strategies to ensure a steady stream of work-ready talent and invest sufficient budget to guarantee high-quality outcomes for employees and the business.
Partner well: While Africa has the fastest-growing youth population of any continent, there are still significant systemic challenges with equipping youth with adequate work-ready skills.
“Africa’s ability to reap the benefits of AI-related innovation rests on broader public-private sector efforts at cultivating the correct skills mix,” said Koolen. “Partnering with educational institutions and other industry skills development initiatives can accelerate the rate at which skills become available to companies.”
She added that technology vendors can also play a valuable role. “Large technology companies often have large global workforces and strong employer brands, allowing them to attract top talent. Partnering with tech venters can augment organisations’ skills base and provide valuable support to AI-led initiatives.”
E-Business
Google Announces $37m Funding in Africa

Google has outlined a wave of AI support across Africa, representing $37 million in cumulative funding — including previously committed but unannounced funding — to research, talent development, and infrastructure.
The funding package includes funding and partnerships that aim to strengthen AI research, support African languages, improve food systems, expand digital skills, and build research capacity.
The AI Collaborative for Food Security, a multi-partner initiative launched with $25 million in funding from Google.org will bring together researchers, and nonprofit organizations to co-develop AI tools for early hunger forecasting, crop resilience, and tailored guidance for smallholder farmers.
The goal is to help make food systems across Africa more adaptive, equitable, and resilient in the face of increasing climate and economic shocks.
Google also announced $3 million in funding to the Masakhane Research Foundation, the open research collective advancing AI tools in over 40 African languages.
The funding will support the development of high-quality datasets, machine translation models, and speech tools that make digital content more accessible to millions of Africans in their native languages.
To further empower innovation, Google is launching a catalytic funding initiative to support AI-driven startups tackling real-world challenges.
This platform will combine philanthropic capital, venture investment, and Google’s technical expertise to help more than 100 early-stage ventures scale AI-based solutions in agriculture, healthcare, education, and other vital sectors.
Startups will also receive mentorship, access to tools, and technical guidance to support responsible development.
Africa’s AI talent is growing rapidly, but the infrastructure to support it must grow in tandem.
That’s why a cornerstone of this announcement is the launch of the AI Community Center in Accra — a first-of-its-kind space for AI learning, experimentation, and collaboration in Africa.
The Center will host training sessions, community events, and workshops focused on responsible AI development. Its programming will span four pillars: AI literacy, community technology, social impact, and arts and culture — providing a platform for a diverse ecosystem of developers, students, and creators to engage with AI in ways that are grounded in African priorities.
To help meet the rising demand for AI and digital skills, Google is rolling out 100,000 Google Career Certificate scholarships for students in higher learning institutions across Ghana.
These fully funded, self-paced programs will focus on AI Essentials, Prompting Essentials, and other high-growth fields like IT Support, Data Analytics, and Cybersecurity — enabling more learners to access job-ready training and build careers in AI and the digital economy.
Beyond Ghana, Google.org is committing an additional $7 million to support AI education across Nigeria, Kenya, South Africa, and Ghana.
The funding will support academic institutions and nonprofits building localized AI curricula, online safety training, and cybersecurity programs.
Additionally, two new $1 million grants from Google.org aim to bolster AI research capacity across the continent.
One grant goes to the African Institute for Data Science and Artificial Intelligence (AfriDSAI) at the University of Pretoria to support applied AI research and training.
The other supports the Wits Machine Intelligence and Neural Discovery (MIND) Institute in South Africa, which will fund MSc and PhD students to conduct foundational AI research and help shape Africa’s role in the global AI landscape.
Speaking about the announcements, James Manyika, senior vice president for Research, Labs, and Technology & Society at Google, said: “Africa is home to some of the most important and inspiring work in AI today. We are committed to supporting the next wave of innovation through long-term investment, local partnerships, and platforms that help researchers and entrepreneurs build solutions that matter.”
Yossi Matias, vice president of Engineering and Research at Google, added: “This new wave of support reflects our belief in the talent, creativity, and ingenuity across the continent. By building with local communities and institutions, we’re supporting solutions that are rooted in Africa’s realities and built for global impact.”
E-Business
How High the Risk of a Cyber Incident in Your Organisation

One of the core reasons why businesses remain vulnerable to cyberthreats is that they underestimate their risk or overestimate the strength of their existing defences.
According to a recent Kaspersky survey entitled “Cybersecurity in the workplace: Employee knowledge and behaviour”, 52,1% of professionals surveyed in the Middle East, Turkiye and Africa (META) region, whose work requires the use of computers, asses the risk of a cybersecurity incident happening to their company as quite possible.
Commenting on the probable consequences of a cybersecurity incident, 55,6% of employees surveyed supposed that it might seriously affect the company. This understanding of risks comes not only from general cybersecurity awareness, but also from knowledge about cyber incidents in their organisations: 31,8% of respondents acknowledged such incidents happened in the past 12-months, while an additional 26,2% said they have heard about these incidents from colleagues.
Organisations nowadays face a variety of cyberthreats ranging from phishing and business email compromise to ransomware and advanced persistent threats.
In a lot of these attacks, the entry point into the organisation’s network is via a human mistake, and it is for that reason attackers actively employ social engineering techniques and AI tools to make their efforts more effective.
The survey shows that the majority of respondents understand that cybersecurity is an issue that should be considered by the IT department, while 23,9% also mentioned top level executives and 15,9% cited legal and financial employees as core groups within the business who should keep cybersecurity issues in mind. Only 30,6% of employees surveyed viewed cybersecurity as an issue that should be considered by all employees across the entire business.
“In today’s digital landscape, cybersecurity is a collective responsibility that extends beyond the IT department. Every employee should remain vigilant against evolving threats.
“Regular cybersecurity training, use of relevant IT solutions, well-defined policies and an incident response plan are essential pillars of organisational cyber resilience. When every team member is informed and prepared, the organisation stands stronger against cyber threats,” says Brandon Muller, Technical Expert for the MEA region at Kaspersky.
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