Stears on the impact of COVID-19 on small businesses in Nigeria

The impact of COVID-19 on small businesses in Nigeria is likely to be severe, according to data from Steers. With the local spread of the virus and the partial shutdown of the Nigerian economy, the situation looks bleak for entrepreneurs in the country. Michael Famoroti, Chief Economist at Steers, recently discussed these challenges in an interview with CNBC Africa. Famoroti highlighted the dire situation faced by the 40 million small businesses in Nigeria. He pointed out that these businesses are ill-equipped to handle a crisis of this scale, making them particularly vulnerable to the economic repercussions of the pandemic. The lack of resources and financial buffers puts these entrepreneurs at risk of closure and bankruptcy. One of the key issues raised in the interview was the limited capacity of small businesses to weather the impact of the crisis. With many businesses already struggling to survive in Nigeria's competitive market, the added burden of the pandemic and economic shutdown could prove to be insurmountable. Famoroti emphasized the need for targeted support and intervention to prevent widespread closures and job losses. The interview also delved into the logistical challenges faced by small businesses in adapting to the new normal imposed by the pandemic. Famoroti discussed how social distancing measures, supply chain disruptions, and reduced consumer demand have created significant obstacles for entrepreneurs. The shift to remote work and online operations has further strained businesses that lack the technological infrastructure to support these changes. In light of the grim predictions for small businesses in Nigeria, policymakers and stakeholders are called upon to take urgent action. Famoroti urged the government to implement targeted stimulus packages, provide access to cheap credit, and offer tax relief to struggling businesses. He emphasized the need for a coordinated effort to support entrepreneurs and prevent a widespread economic collapse. As the COVID-19 pandemic continues to unfold, the fate of small businesses in Nigeria hangs in the balance. Without swift and decisive action, the country risks losing a considerable portion of its entrepreneurial ecosystem. The resilience and adaptability of Nigerian entrepreneurs will be put to the test in the coming months as they navigate unprecedented challenges and uncertainties.