Aerial view of buildings and markets on Lagos Island.
Nigerian small businesses lack the finance they need to meet their international ambition, as 86 per cent of them surveyed participated in international trade, compared to a global average of 77 per cent, while 55 per cent called for improved access to export finance.
This shows that given the right opportunities, Nigerian small businesses are very likely to participate in international trade, but are struggling to access the necessary finance, the new research by the Association of Chartered Certified Accountants (ACCA), noted.
But more importantly, this is an indication that despite the acclaimed level of support from the banking sector and huge government interventions, there is still huge gap to be closed.
The report, titled: “Growing globally,” surveyed small and medium sized businesses and the accounting practices around the world to identify levels of participation in and the appetite for international trade.
“Internationalisation can potentially bring a range of growth benefits for both small businesses and the broader economy, while also driving productivity.
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“It’s encouraging that so many Nigerian businesses have the appetite to internationalise, but small businesses need to ensure they have access to the right professional advice and support to do so successfully. Almost a third (31%) of respondents identified a lack of access to external finance, such as export finance – as a barrier to successful internationalisation.
“Financial literacy is essential for entrepreneurs to run their businesses effectively, efficiently and profitably. It also enables them to financially plan, manage their finance function and access external funding.
“More support needs to be provided by the Nigerian government to ensure business owners are equipped with key financial literacy skills. This, in turn, will improve Nigerian SMEs’ ability to obtain external finance and help them grow sustainably,” the Head of SME Policy at ACCA, Ben Baruch, said.
The report also provides some recommendations for small businesses looking to expand their international capability, including embracing cloud technologies, developing the scalability of the finance function, creating a business strategy with global ambitions and identifying where external advice could support internationalisation.”
“Accountants and particularly, small-to-medium sized practices (SMPs), which we focus on in Growing globally – are one of the most useful resources for supporting small businesses across all of these areas,” he concluded.
Source: G Business
