The fundamental socio-economic developmental question — “What Can We Do to Encourage SMEs to Trade and Invest Confidently Across the Commonwealth? — needs to be addressed within the framework of the varied economic and development capacities and capabilities of member-nations of the Commonwealth.
In the first place, it has been universally acknowledged that Small & Medium-scale Enterprises [SMEs] constitute the back-bone of any nation with positive economic growth and for sustainable development, especially in terms of generating employment for the teeming population of youths and for engaging the under-privileged groups, including women, semi-skilled and unskilled persons. Such have been their increasing roles in the sustainable development of national economies that the sub-group “Micro” has been added to SMEs to form “Micro, Small & Medium-scale Enterprises [MSMEs]”.
Available statistical evidence is indicative of the strong correlation between SMEs, developed nations and hopefully-developing nations, particularly in their productive capacities and in the areas of job creation, poverty reduction and general societal well-being. Indeed, four out of five new formal positions in emerging economies, according to the World Bank, are direct products and outcrops of SMEs.
Secondly, an appreciation of the challenges which SMEs are faced with in the Commonwealth will requirea full grasp of the challenges SMEs are confronted with within individual member-nations. The distinction between the macro-level challenges on the one hand and micro-level challenges on the other, is both revealing and instructive: Though the combined Gross Domestic Product [GDP] of the 54 Commonwealth nations is 10 trillion United States Dollars, only 4 [or 7.41%] of these countries – approximated to the United Kingdom with US$2.6 trillion, India with US$2.4 trillion, Canada with US$1.5 trillion, and Australia with US$1.2 trillion — account for over 75%, while the other 50 countries [92.59%] share the balance of 25%. In the same vein, only 10 [18.5%] of the member-nations [the UK, Australia, Brunei, Canada, Cyprus, India, Malta, Pakistan, Singapore, and New Zealand) could be said to be outside the orbit of the so-called Third World economies, under which label the other 44 member-nations [81.5%] have been tagged.
In the light of the foregoing, the policies and programmes of Commonwealth countries to support and grow SMEs must be designed to accommodate the vagaries and challenges within the various member-nations, including those of day-to-day management and development conflicts. In Africa, for instance, the realities of everyday governance and developmental challenges are underpinned by stability, policy, organizational, managerial as well as scientific & technological deficits and bottlenecks.
Thirdly, listening to Bill Gates in a recent presentation, he indicated that one of the ways to get the right thing done is to learn from those who are doing it right, and emulate them. Within the framework of this logical perspective, it then becomes imperative that the Commonwealth nations should understudy the impressive and commendable economic strides achieved by the success stories, including the Republic of China.
With the fastest recorded sustainable economic expansion than any other major economic power in modern history, China has grown its economy tremendously within a quarter of a century; from a GDP of less than a trillion US Dollars to a GDP of about 12 trillion US Dollars. China’s population is about half of the combined 2.4 billion population of the Commonwealth, but it has achieved these impressive records with industrialization and export as its back-bone. Interestingly, SMEs contribute 70% of China’s export earnings as well as 60% of its 800 million full-time jobs.
Fourthly, given the right policies and sustained, active support for SMEs across the Commonwealth countries, their combined GDP could well experience a phenomenal growth of up to 18 trillion US Dollars by the Year 2030. That year – in barely twelve years hence – is the deadline set for the attainment of the on-going Sustainable Development Goals [SDGs]. Such growth and expansion would enable the Commonwealth countries to create about 200 million jobs, which would be a third of the World Bank target of 600 million jobs within the said period. The total population of the Commonwealth countries is presently a third of the world population.
In the final analysis, the right policies and programmes to support SMEs in Commonwealth countries will be anchored on the vision, commitment and political will of the leadership of the various jurisdictions.
Excepts from the Speech of former Governor of Anambra State, Mr. Peter Obi, at the Commonwealth Business Forum in London from 16th to 18th April, 2018