How SMEs can survive a tough 2016 – Fidelity Bank MD

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The Group Managing Director/Chief Executive Officer of Fidelity Bank Plc, Mr. Nnamdi Okonkwo has said that the over reliance on proceeds from crude oil in the past made a lot of Nigerians lazy.

Okonkwo, said this while speaking on the Fidelity SME Radio monitored on Inspiration FM, Lagos.
While stating that 2015 was a tough year for a lot of Nigerians, he asserted that things might even be tougher this year if crude oil price continue to decline. According to him, everybody in Nigeria has  realised that what is happening to the economy presently, resulted from  the over reliance on crude oil in the past.

“The oil economy just made a lot of people lazy and what you saw was that we started importing everything that we could produce here. Why for instance, would we be importing frozen chicken? Some of these chickens are smuggled into the country through Cotonou and some through the port. Some of the imported chickens are preserved with dangerous chemicals.

“But, how long does it take from the time you buy day old chickens to feeding them to mature to broilers, layers for eggs?  But everybody would rather spend on importation because we had the foreign exchange to play around with then,” Okonkwo stated.

He urged operators of small and medium scale enterprises (SMEs) to focus on goods and services they can be produced locally, saying that in reality, things would be tough for SMEs that are dependent  on imports.
According to the Fidelity Bank boss,  conventional wisdom is that with the situation of things in the country, SMEs must begin to look inwards to tap from the numerous opportunities in the country.

Okonkwo explained: “Now, for an SME to succeed, the number one thing is that you have to first of all identify a need, then you provide the service that fills the need. The huge population of Nigeria is positive for SMEs. If you cast your mind back to around 1984 when we had serious economic downturn, we used to queue behind trucks to get milk. What happened? A lot of people started producing soya milk in the country and we began to have substitutes for imported milk.

“So, what I am trying to say is that this country is blessed abundantly, especially in the area of agriculture. So, we must all go back to the basis. There are opportunities and we just have to identify them and not continue to depend on imports.”

He assured that Fidelity Bank would continue continue to support SMEs and start-ups in the country that are properly structured.
“We give loans to new start-ups, if not nobody is going to support them. But, new start-ups must package themselves properly.

That is why Fidelity Bank has a division called Managed SME. If you go to our offices, especially at Adeyemo Alakija, Lagos, they would go through what you have and help you to put your business in perspective and give you tips on how to succeed. We have to hand-hold the start-up and teach you how to play. You first of all have to start keeping proper records, have a business plan and we try to know where the promoter of the business wants to go with the business,” he said.

According to him, the foreign exchange controls that had been introduced by the Central Bank of Nigeria were to preserve the country’s external reserves.
“The CBN simply does not produce dollars, Nigeria earns dollars and Nigeria has to earn foreign reserves. If we deplete all the reserves and we don’t have buffers, things would be difficult for us a country. Capital controls are necessary, however, what the industry has done is to ensure that our scarce foreign exchange are channelled to essential commodities and real sector to add value to the economy,” he said.

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