It’s a no longer news that entrepreneurs are tagged ” Suffering and Smiling,” compared to their counterparts working as civil servants. It is truly a lonely and a tough journey to embark on. You know why? Read on!
Let me begin with my friend Adaora, who left for abroad just to do jobs that can pay her far better than what she was earning here as a clothing designer in Abuja. The first week she launched her clothing line, she was welcomed by AEDC (Abuja Electric Distribution Company) to pay N50,000 electricity bill consumed by the former occupant of her shop. The second week, the Abuja Municipal Area council (AMAC) came, asking her to pay her yearly levy for business premise. The car she was using for her business broke down with engine problems. Adaora was just barely a few weeks old at her place of work when all these issues arose. She had no other option but leave this country. The other time we spoke, she told me she was gradually finding her feet there. She recalled her ugly ordeal in the past and we laughed over it. She reminded me that she was proud being a Nigerian but only went there to make money and come back as she wouldn’t want to be a liability to her aging retiree parents who saw her through the tertiary institution.
Or can I talk about Lawrence, my printer at UTC, Area 10, Garki Abuja, who runs a printing business. He didn’t have all the equipment needed for the printing business. He is always glued to his radio and newspapers searching for any information or to know when the government is giving offer of loans and making it available for small businesses like his. Usually, such is done through participating financial institutions like SMEDAN. He has applied severally for a few of them but to no avail, only to later realize that he couldn’t meet up with their requirements respectively. Lawrence found the documentation too much and of which they asking for guarantors. He could not risk using his father who is a retired teacher and with other tight laws surrounding the loan. He gave up on the loans and continued pushing his printing job. He was very hopeful and optimistic that one day he would acquire the printing machines such as DI and other equipment needed for a good printing work
At this juncture, I want to bring to your notice that one of the fundamentals of every economy is sparked by encouraging and promoting entrepreneurship, especially the young and talented youths because it’s also an income generating sector of the economy too. Government and business are inextricably linked, with the actions of one often imposing consequence on the other. It is in government’s best interest to keep the economy healthy by, among other things, ensuring an encouraging environment for small and large businesses. This being the case, the government has a number of tools at its disposal to encourage business activity throughout the economy or in specific industries.
Entrepreneurs should be encouraged and be rewarded with Tax credits and Incentives, friendly trade policies, provision of contract jobs to private business owners, single digit interest rates, loans and grants and, entrepreneurship trainings.
1. Tax Credits and Incentives:
Business tax credit is an amount that companies can subtract from the taxes owed to a government. Business tax credits are applied against the taxes owed, as opposed to a deduction that is used to reduce taxable income. Businesses apply the tax credits when they file their annual tax returns. While a tax incentive on the other hand is a government measure that is mapped out to encourage individuals and businesses in order to spend or save money by reducing the amount of tax that has to be paid.
It will boost tax equity especially that of income taxes and will be beneficial to both startups and micro, small and medium businesses.
Saliently, loans and grants programs offered to entrepreneurs is an effective way of stimulating business growth. They should be lowered.
It also reduces unemployment thereby reducing making the talented youths to startup business with their business ideas.
It also reduces the rates of corporate income tax, allowing temporary tax deductions for business investment
2. Friendly Trade Policies:
In Macroeconomics, there’s what is called foreign trade policies where the government introduces and encourages friendly relations with other nations and provides opportunities for a global understudy of markets so as to strengthen our comparative advantage of foreign trade internationally.
Tariffs and quotas are also reduced. Free trade zones and relaxed trade restrictions when implemented also help growth of local business. Again, Nigeria should play safe when it comes to treaty issues so as to encourage more foreign investors.
Most importantly, it gives room for more jobs, higher earnings, it aids better and quality products, less inflation and the freer and friendly the flow of foreign trade, the stronger the tides for economic progress and it enhances peace among nations.
3: Provision of Contract Jobs to Private Companies:
Business activities are highly encouraged when both the Federal and State government agencies give contract jobs of say Energy, Construction, Real estate projects, etc, to private companies. For example, government can contract third party real estates to build smaller estates for the masses and with a minimal mortgage revenue instead of the government itself creating an internal revenue structure when they know that the contract is a short term kind of.
4. Single Digit Interest Rate:
Non-banking financial lending interest should be regulated and controlled by the Central Bank of Nigeria (CBN). The CBN’s current banking policy in loans to deposit ratio too should be reviewed because their current offering is 15 percent. For example, if in every N50 deposit, commercial banks collect N11.25 from the public and CBN does not give interest on such deposits and this automatically makes the commercial banks to generate more revenue of the remaining N38.75. This in turn will affect lending interest rates. On the other hand, borrowing can be profitably attractive if only commercial banks make lower deposits on the CBN on every N50.
5. Loans and grants:
Loans and grants should be given to small businesses like sole proprietorship. There should be provision of loans and creation of easy access to such loans. Entrepreneurs too should be given grants by government financial agencies and not mere lip service promises and at the end it will be granted to non-entrepreneurs who doesn’t deserve the grants.
6. Entrepreneurship Training.
If it is inculcated in secondary and tertiary school curricula like every other subject, it will create a great impact on the economy. Entrepreneurship is a valuable life skill for everyone, especially those aspiring to be business owners.
Entrepreneurial education and training should also be encouraged by government in that it provides individuals especially the talented youths and business owners with the ability to recognize commercial opportunities, self‐esteem in business, knowledge and skills to act on them. It includes instruction in opportunity recognition, commercializing a concept or contents, managing resources, and initiating a business ideas or ventures.
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