2.1.5.2 Small Businesses in Africa.
Despite the claims globally to the talismanic success of SMEs, Africa is yet to catch up with the fever. In the words of Asmelash (2002), despite the ”repeated public announcements about their assumed importance as instruments of development, SMEs in many African countries enjoy a lukewarm support. They lack effective organisation and knowledge of modern management techniques. Organisations created to promote SMEs are not sufficiently prepared for the task and the interference with policy-makers leaves much to be desired”. Although this is true, it is not always so because one cannot overlook the successful small businesses we see in the streets of Lagos, who despite the constrains of poor social infrastructure particularly electricity and water supply still remain economically viable. There is also the problem of frequent harassment by government officials who extort money from these businesses.
Small business remain a veritable tool for encouragement of entrepreneurship, creating immediate employment opportunities, promoting inter- and intra-regional trade, breaking monopoly of larger enterprises as well as alleviating poverty (Cook and Nisxon, 2000) world over. They can usually be established rapidly and put into operation to produce quick returns. Several African small businesses do not fall short of these qualities but that cannot be justified in the present scheme of things. The reason however is not farfetched because corruption and political instability continues to thrive. Small businesses in Nigeria probably dipped with the introduction of the Structural Adjustment Programme (SAP) in 1986 by the Military government of General Ibrahim Babangida.
The SAP policy according to Mambula (2002) caused the value of the national currency to decline. This made it difficult for small business to afford to train their workers overseas and obtain foreign exchange to order or purchase machinery and spares parts.
Small business remains a viable alternative to foreign direct investments (FDI) which are difficult to access as a result the high risk ratings of developing countries like Nigeria (Mambula,2002).