ABSTRACT
As agreed by many, the development of small firm is a precondition for any country on the sustainable growth and development of its industry. SMEs are industries of tomorrow unless these inductees survive today and grow; we may not have large industries of tomorrow
In an attempt to evolve a virile SMF that would size un the challenges of the 2Ist century, efforts were made at an extensive usage of both secondary sources comprises relevant information from text books, journals, periodicals, seminar papers and previews literature on the subject matter, the primary source was through the administration of questionnaires and personal interview condition.
With the objectives of evolving new strategies and policies that will not only ensure the survival of small firms but also result in their development and growth based on findings, this research work was divided into five (5) chapters.
Chapter one(l) is the introductory chapter which introduces the project topic in terms of stating reasons which has prompted the research explains the objectives, significance, statement of problem and scope of the study.
Chapter two (2) comprises general review on the subject matter. It also involves definition of concepts, why have public policy in the development of SME’s in Nigeria, growth of SMEs in Nigeria, obstacles Targets of small firm policy, problems of SMEs in Nigeria and theories guiding SME.
Chapter four (3) exemplified the procedures and methodology adopted in the task or process of collecting data/ information made use of in the course of study.
Chapter four (4) is designed to analyses and interprets all the data generated in the course of the study. The data mainly used is from the administration of questionnaires and interviews.
Lastly, Chapter five (5) is the conclusion and involves the study, finding, recommendations and conclusion made to enhance further research.
CHAPTER ONE
INTRODUCTION
A Small scale industry is defined as one employing fewer than 300 persons and having a capital less than $28,000. lt was also defined by the Central Bank of Nigeria (CBN) as an enterprises in which total investment (including land and working capital) did not exceed N500,000 and or the annual turnover did not exceed N5.0 million.
Public policy on the other hand is defined as the development of laws and regulation that impact consumers in the market place. lt can also be defined as the principles under which freedom of contract or private dealings are restricted by law for the good of the community. lt is also a governmental law, rule, statute or edict that expresses the governments’ goals and provides for rewards and punishments to promote their attainment.
Small firms are said to be the backbone of the Nigerian economy in as much as enterprise policy is relevant to those looking to achieve economic development in urban areas experiencing high level of deprivation. Public policy on small firms development in Nigeria has to be concerned with two issues: the creation of employment in smaller enterprise and the problems which smaller enterprise experience in obtaining access to finance. Therefore, any discussion of the impact of public policy on small firms development in Nigeria has to be prefaced by asking why such policies should exist. Economist justify government intervention in a market economy when there is evidence of ‘market failure’. Although liberal economist would argue that the presence of market fallure is a necessary, but not sufficient condition for government intervention.
lt is then appropriate to examine carefully the arguments, which have been prescribed by the goverment in support of its small firm policies. Probably, the most frequently heard but least sophisticated, is that small firms have been shown to be a major source of job creation. Thus, to justify intervention in a market econömy, it is necessary to identify precisely where the market failure exist and whether it is possible to rectify that market failure through govemment intervention.
lt is also important to assess who are the losers and the beneficiaries.Ideally, this has to be placed within a macroeconomics framework to yield an overall assessment. The prime objective of macro‑economic policy is not solely to assist smaller firms, but rather to provide a framework for all sizes of enterprises in the economy.
Similarly, when we talk of small firms, we are talking of industries of tomorrow. Unless these industries survive today and grow, we may not have big or large‑scale enterprise tomorrow. lt is no longer news that the small and medium scale enterprises in many countries offer more than 50 percent of the total employment opportunities.
For instance in Nigeria, the SMEs are believed to constitute 70 percent of corporate Nigeria (Management and communication review 1998 Volume 1 No. 1. Thus, for a country like Nigeria, adopting very vffective development policies would in no small measure foster the survival and growth of SMEs, which is conceived as a way of solving its numerous economic problems. The near static annual growth rate of the industrial sector in Nigeria and other less development countries (LDCs) and the growing disappointment with results of development efforts on SME has prompted the reason for this research.
The basic roles and features of SNIEs in most countries are similar but mention few should be made of the fact that there is no universally acceptable definition of SME because the classification of business into small, medium or large scale is a subjective and qualitative judgment. Nigeria’s SMEs (generally an umbrella term for firms with less than 260 employees) experience a lot of problems and hardship, and this is not just as an effect if economic down turn. There are a number of bottlenecks, including services under capitalization with difficulty in gaining access to bank credits and other financial markets. This brings about corruption and lack of transparency (although this is very general to the society), very high bureaucratic costs are but except with the intervention of the government and support for the roles that SMEs play in the national economic development and competitiveness. Still emphasizing on the important and sensitive nature of SMEs there has been a decision switch of emphasis from capital intensive large scale industrial products based on the philosophy of import substitution to SMEs with immense potentials for developing domestic linkages for rapid, sustainable industrial development.
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