Nigeria leads the world in
enthusiasm for business,
according to a survey carried
out by Global Entrepreneurship
Monitor (GEM). Indeed, the
report noted that, all across
Africa, a growing wave of
grassroots self-starters are
taking risks and defying
obstacles to bring their money-making ideas to life.
Armed with a can-do attitude and hopes of striking it big,
they’re navigating a conundrum of challenges to pursue
opportunities at a time when many African countries enjoy
unprecedented levels of economic growth.
GEM is the acclaimed largest study of entrepreneurial
dynamics in the world, providing information to help policy
makers, civil society and the business community
understand the obstacles to nurturing entrepreneurship,
enterprise promotion and growth. GEM annual surveys arer
carried out in 99 countries.
The GEM survey noted that Nigeria leads the world in the
proportion of the population who believe they have the
skills to run a business, with almost 90 percent of Nigerian
adults believing they have the ability to become
entrepreneurs. The result of the survey shows that out of
every 100 Nigerian adults, 35 are involved in some sort of
entrepreneurial activities. It added that Nigerians are not
deterred by fear that their new enterprise will fail; only 21
percent were concerned by this risk.
The survey confirms Nigeria as an entrepreneurial nation,
where most adult Nigerians see opportunities in
entrepreneurship, believe in their own entrepreneurial
capacities and declare themselves ready to start and run a
business. Indeed, 44 percent of the population intend to
create their own businesses within the next five years. Of
those surveyed for GEM, almost a quarter (22 percent) said
they expected to create between 6 and 19 jobs over the next
five years.
Growth and development
In 2012, the report stated, 21.7 percent of Nigerians aged
between 18 and 64 years of age were preparing to start a
new business, which is the second highest rate in sub-
Saharan Africa, after Zambia, and 14.9 percent of adults
were actually running a new business.
GEM noted that Nigeria had taken a number of steps to
support small and medium-sized enterprises and the federal
government has established support for the private sector
as a policy priority. “A number of schemes to help small
business are in operation such as the Bank of Industry (BoI)
and the Bank of Agriculture (BoA).”
Access to finance
All new entrepreneurs report finding financing for their
ventures is a barrier to creating and growing an enterprise,
while lack of access to finance is the major reason for the
discontinuance of an enterprise. There are few domestic
equity sources, as well as limited sources of export finance,
and SMEs’ participation in the stock market is minimal, due
to their inability to meet the listing requirements, as well as
their persistent tendency to operate as much as possible in
the informal sector.
The commercial banks remain the primary formal source of
finance for enterprises. Though banks are already
encouraged to give more money to entrepreneurs, but
procedures need to be simplified and information about
financing schemes should be more widely available.
Gender dynamics
Nigeria stands along with the handful of countries with more
women entrepreneurs than men and more early-stage
female entrepreneurs than males. Africa leads the world in
the number of women starting businesses, with almost
equal levels of male and female entrepreneurs. In fact, in
countries like Ghana, Nigeria and Zambia the women
outnumber the men.
Overall, the continent has a much higher proportion of
female entrepreneurs compared to other regions, with
Nigeria and Zambia (both 40.7 percent) coming on top and
countries like the United States (10.4 percent), the UK (5.5
percent), Norway (3.6 percent) and France (3.1 percent)
lagging far behind. According to Mike Herrington, executive
director of Global Entrepreneurship Monitor (GEM) and
professor at the University of Cape Town in South Africa, the
main reason for this is because women in Africa “need to
earn an extra income to be able to afford to send their
children to school.”
Young entrepreneurs
About 82 percent of Nigerian young people perceive a good
opportunity to start a business while 86 percent believe that
they have the skills and knowledge necessary to start a
business. However, young males tend to have slightly higher
intentions and perceptions of good entrepreneurial
opportunities and capabilities than the young females.
Over 82 percent of Nigerian youths see entrepreneurship as
a good career, 77 percent believe that successful
entrepreneurs have high status and recognition and 78
percent are comfortable with the level of visibility that
entrepreneurs enjoy in the media. The decision to go into
entrepreneurship was mostly influenced by parents and
friends. This is reflected in the fact that the majority of
young entrepreneurs source their start-up finance from
family and friends, and nearly half of them conduct their
business from home or on the street.
Source: www.vanguardngr.com/2015/03/business-enthusiasm-nigeria-tops-global-ranking/