Effect of Investment Climate on Small and Medium Scale Enterprises Growth in Makurdi Metropolis, Benue State Nigeria
DOI:
https://doi.org/10.53555/nnbma.v5i7.783Keywords:
Investment, Climate, SMEs, Growth, Benue, NigeriaAbstract
This study evaluated the effect of investment climate on Small and Medium Scale Enterprises growth in Makurdi Metropolis. The study was anchored on The Neoclassical Approach, Financial Growth Theory and Theory of diffusion of innovation. The researcher used both primary and secondary sources from a sample of 250 respondents obtained by the use of a well structured questionnaire from the study areas. The demographic data collected were analyzed using descriptive statistics such as frequency, simple percentage and the relationship between the variables of the study were analyzed using multiple linear regression analysis. The hypotheses of the study were tested using the probability value of the estimates. The result of the regression analysis indicates that a negative relationship exist between access to credit (ACTC) and Small and Medium Scale Enterprises growth in Makurdi Metropolis Nigeria (SGT) and the relationship is not statistically significant (p>0.05) and not in line with a priori expectation. Power supply (PWSP) was positively related to Small and Medium Scale Enterprises Growth in Makurdi Metropolis Nigeria (SGT) and the relationship is statistically significant (p<0.05) and in line with a priori expectation. A positive relationship exist between Information and Communication Technology (ICT) and Small and Medium Scale Enterprises Growth in Makurdi Metropolis Nigeria (SGT) and the relationship is statistically significant (p<0.05) and in line with a priori expectation. It was concluded that for this growth to be achieved, the climate of investment must be addressed and made favourable for business start-up and growth. It was recommended that government should effectively regulate the power sector as there are still lingering challenges with billings, tariffs and metering processes after privatization. To ameliorate the problem faced by SMEs in the study area, government can create hubs for SMEs in the study area and provide them with adequate electricity or develop renewable energy such as solar energy to improve entrepreneurs' access and growth.
References
Abdullah, M. A. (2000). Small and Medium Enterprises (SMEs): Some pertinent issues. In Abdullah, M. A. & Bin Bakar, M. I. (eds). Small and medium Enterprises in Asian Pacific countries, (vol. 1). 3-14. New York: Nova Science publishers Inc.
Adeyemi, S. L. (2011). Small and medium scale enterprises as survival strategy for employment generation in Nigeria. Journal of sustainable Development, 4(1), 200-206.
Adom, P. K. (2011). ‘Electricity Consumption-Economic Growth Nexus: The African Development Bank (AfDB). 2012. Supporting the Transformation of the Private Sector in Africa: Private sector development strategy of the African Development Bank Group, 2012¬-2017 (Abidjan).
Ajayi, G. O. (2000). Entrepreneurship Development in Nigeria. Abeokuta, Nigeria; Ajayi Publishing.
Altenburg, T. and Eckhardt, U. (2006). Productivity enhancement and equitable Analysis of the Causal Relationship’, Resources and Energy 2, 1979 and applications to technical vocational education and training (TVET) system in Nigeria. Journal of Research and Development,1(6), 25-35.
Altenburg, T. and Von Drachenfels, C. (2006). The ‘new minimalist approach’ to private-sector development: a critical assessment. Development Policy Review 24(4): 387-411.
Arbaugh, J.B., & Sexton, D.L. (1996). New firm growth and development: A replication and extension of Reynolds’ research. Journal of Enterprising Culture, 4(1):19-36
Aremu, M.A. & Adeyemi, S. A. (2011).Small and Medium Scale Enterprises as a Survival Strategy for Employment Generation in Nigeria. Journal of Sustainable Development, Canadian Centre of Science and Education.4 (1).200-206.
Asaju, K. (2010). Vision 20:20:20, Realities and Challenges, in Faculty of Administration Conference Proceedings, ABU Zaria, 1, 162-173.
Asaolu, T. O., Oladoyin, A. M., & Oladele, P. O. (2005). A Consideration of the Problems and Prospects of Revitalizing the Small-Scale Sector in Nigeria. European Journal of Scientific Research, 7(3), 5-11.
Barnes, C. (2011). Microfinance Program Clients and Impact: an assessment of Zambuko Trust Zimbambwe, AIMS project report; USAID, Washington.
Beck, T. & Cull, R. (2014). Small and medium-sized enterprise finance in Africa. African Growth Initiative (working paper 16). Washington DC: Brookings.
Beck, T. and Maksimovic, V. (2002), .Financial and Legal Constraints to Growth: Does Firm Size Matter? The Journal of Finance LX (1),137-177.
Bolnick, K., Bruce, T. and Nelson, E. (1990). Evaluating the Impact of Special Credit Program in Indonesia. The Journal of Development Studies, 7(7)61-63.
Bowen, A., Cochrane, S. and Fankhauser, S. (2012). Climate change, adaptation and economic growth, Climatic Change, Springer, vol. 113(2):95-106.
CBN (2014). Understanding Monetary Policy Series No.43: The Informal Financial Market inNigeria.www.cbn.gov.ng retrieved 31st July, 2017.
Chaston, I. and Mangles, T. (2017), “Competencies for growth in SME sector manufacturing ?rms”, Journal of Small Business Management, 35(1):32-41.
Cochrane S. and Fankhauser S. (2012). Climate change, adaptation and economic growth. Climatic Change, 113(2): 95-101.
De Soto, Hernando, 1990, The Other Path, New York, NY: Harper and Row.
De Soto, Hernando, 2000, The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else, New York: Basic books.
Dollar, D., Hallward-Driemeier, M. and Mengistae, T. (2005). Investment Climate and Firm Performance in Developing Economies. Economic Development and Cultural Change, Chicago: University of Chicago Press, pp. 1-7.
Dunn, E. (2001). Microcredit and Microenterprise Performance: Impact Evidence from Peru. Small Enterprise Development Journal, 12, 22-33.
Ebaidalla, E. (2014) Youth Unemployment in the Arab World: An Analysis of Causes and Possible Ways Forward. In Naoual Belakhdar, et al. (ed), Arab Revolutions and Beyond: Change and Persistence, Center for North African and Middle Eastern Politics, Freie University Berlin, Berlin., pp. 113-126
Etuk, R. U., Etuk, G. R., & Baghebo, M. (2014). Small and medium scale enterprises (SMEs) and Nigeria’s Economic Development. Mediterranean Journal of Social Sciences, 5(7):656-662.
Fjose S., Grunfeld L. A. and Green C. (2010). SMEs and growth in sub-Saharan Africa. Identifying SME roles and obstacles to SME growth. MENON Business Economics Publication no. 14/2010.
Gans, J.S. and Stern, S., (2000). Incumbency and R&D incentives: licensing the gale of creative destruction. Journal of Economics and Management Strategy 9 (4), 485–511.
Goffee, R. and Scase, R. (2015). Proprietorial Control in Family Firms: Some Functions of ‘Quasi?Organic’ Management Systems, Journal of Management Studies, 22(1):53-68
Hampel-Milagrosa A., Loewe, M. and Reeg, C. (2015). The entrepreneur makes a difference: evidence on MSE upgrading factors from Egypt, India and the Philippines. World Development 66: 118-130.
IFC, (2005). Gender Dividend: Growth through Gender Equality, Summary of PREM Week symposium.
IFC (2007). Annual report 2007: Creating opportunity (English). Washington DC.
Joint Research Centre (2015), Measuring Entrepreneurship: A Digest of Indicators, OECD-Eurostat Entrepreneurship Indicators Program, OECD, Pari.
Khandker, S., Knedlik, N. and Shahidur R. (1998). Fighting poverty with Microcredit: Experience in Bangladesh, New York: Oxford University Press.
Klapper, L. (2006). Entrepreneurship. Viewpoint: Public Policy for the Private Sector; Note No. 313. World Bank, Washington, DC.
Klein, K. E. (2006). Funding a new small business? Don’t bother with banks. Business Week (Feb10-Feb16, 2014):1.
Klein, M.U. and Hadjimichael. B. (2013). The Private Sector in Development. Entrepreneurship, Regulation, and Competitive Disciplines. Washington, D.C.
Kolvereid, L. (2016). Growth aspirations among Norwegian entrepreneurs. Journal of Business Venturing, 7(3):209–222.
Kolvereid, L. and Bullvag, E. (2016). Growth Intentions and Actual Growth: The Impact of Entrepreneurial Choice. Journal of Enterprising Culture (JEC), 4(1):1-17
Lyons M., Brown A. and Msoka C. (2014). Do micro enterprises benefit from the ‘doing business’ reforms? The case of street-vending in Tanzania. Urban Studies, 51(8): 1593-1612.
Masurel, E. and Montfort, K.V. (2016). Life cycle characteristics of small professional service firms. Journal of Small Business Management, 44(3):461- 437
Mills, R. and Fan, Q. (2006). The Investment Climate in Post-Conflict Situations, World Bank Institute, pp. 78-81.
Moran, T. (2006). Toward Best Outcomes from Foreign Direct Investment in Poorly Performing States. Journal of Small Business Economy, 14(1): 311-321.
Muktar, B. G., Gambo, B.A., & Mukhtar, U. (2015). Consumer preference analysis on local and imported citrus fruit in kano metropolis. Journal of Agricultural Economics, Extension and Rural Development, 3(11), 351-358.
Mustapha A.I. and Abdullahi, I.F. (2015). Challenges of Entrepreneurship as Perceived by Undergraduate of Tertiary Institutions in Kaduna State.
National Council of Industry (2001). Proceeding at the 13th National Council Meeting held in Makurdi; Benue State.
National Council of Industries (2009). ANNUAL REPORT, September 2009.
Nigerian Institute Of Social And Economic Research (NISER, 2014), Baseline Economic Survey Of Small And Medium Scale Industries In Nigeria, National Synthesis Final Report; Survey Of Existing Small And Medium Industries Part A (Chapters 1-4),SUBMITTED To Implementation Committee On Baseline Economic Survey Of SMIs In Nigeria.
Nnanna, O. (2002). The importance of small and medium scale industries in economic development. Bing a Paper Presented at a Workshop on Small and Medium Scale Industries, Equity Investment Scheme, Abuja, Nigeria.
Nyanzu, F. and Adarkwah, J. (2016). Effect of Power Supply on the performance of Small and Medium Size Enterprises: A comparative analysis between SMEs in Tema and the Northern part of Ghana. Journal of Small Business Management, 12(7):58-70.
Nzotta, S. M. (2004). Money banking and finance: Theory and practice. Owerri: Jude- Hudson, pp 65-71.
Oba, U. O., and Onuoha, B. C. (2013). The role of small and medium scale enterprises in poverty reduction in Nigeria: 2001- 2011. African research review, an international multidisciplinary journal, Ethiopia 7(4):1-25.
ODA (2018). Development aid stable in 2018 with more sent to poorest countries, 2018.
OECD (2004). Promoting entrepreneurship and innovative SMEs in a Global Economy: Towards a more responsible and inclusive globalization. A Report of 2nd OECD Conference of Ministers Responsible for Small and Medium Sized Enterprise (SMEs) in Istanbul, Turkey (3-5 June, 2004).
Ogechukwu, A. D. (2011). The role of small scale industry in national development in Nigeria. Universal Journal of Management and Social Sciences, 1, 23-41.
Ogechukwu, A, D., Oboreh, J. S., Umokoro, F., & Uche, A. V. (2013). Small and medium scale enterprises (SMEs) in Nigeria the Marketing Interface. Global journal of management and Research marketing, 13(9):1-12
Okech, C., Walker, E. A. and Redmond, J. (1995). Ownership Motivation and Strategic Planning in Small Business. Journal of Asia Entrepreneurship and Sustainability, 11(4):71-78.
Okonkwo, N. O., & Obidike, C. P. (2016). Small and medium scale enterprises financing in Nigeria: Problems and prospects. International journal of innovative sciences and Humanities Research, 4(1):77-86.
Okpara, J. O. (2011). Factors constraining the growth and survival of small and medium enterprises in Nigeria: implication for poverty alleviation. Management Research Review, 34(2), 156-171. DOI:10.1108/01409171111102786.
Olabisi, S. Y., Olagbemi, A. A., & Atere, A. A. (2011). Factors affecting small-scale business performance in informal economy in Lagos State-Nigeria: A gender based analysis. Retrieved October 2016, from: http://www.ilo.org.public/english/iira/documents/congree/regional/lagos2011/5thsession/session5a/smallscaleent.pdf.
Osotimehin, K. O., Jegede, C. A., Akinlabi, B. H., & Olajide, O. T. (2012). An evaluation of the challenges and prospect of micro and small scale enterprises development in Nigeria. American Journal of Contemporary Research, 2(4),174-185.
Owualah, S. I. & Obokoh, L. O. (2008). Tackling youth restiveness in the Niger Delta Region of Nigeria through entrepreneurship, Journal of Enterprising Communities: People and Places in the Global Economy, 2(2), 168-179
Palmade, V and Anayiotos, A, (2005). Rising Informality. Policy for the Private Sector: Note 298. Washington: The World Bank.
Runyan R. C. (2006). Small Businesses in the face of crisis: identifying barriers to recovery from a natural disaster. Journal of Contingencies and Crisis Management 14 (1): 12-26.
Shimer, R. (2012). Reassessing the ins and outs of unemployment, Review of Economic Dynamics, 15(2):127-148.
Solomon, G. (2011). Building small and medium scale enterprises: A strategy for economic development in Nigeria. Jos Journal of Economics, 4(1), 130-152.
Taiwo, J. N., Falohun, T. O. (2016). SMEs financing and its effects on Nigerian economic growth. European Journal of Business Economics and Accounting, 4(4), 37-54.
The World Bank, (2005). World Development Report 2005: A Better Investment Climate for Everyone”, World Bank. http://siteresources.worldbank.org/INTWDR2005/Resources/03_WDR_PO1_Ch01.pdf
USAID, (2015). Nigeria: Economic Performance Assessment: Nathan Associates.
World Bank. (2002). Review of Small Business Activities. Washington, DC: World Bank
World Bank, (2005). World Development Report 2005: A Better Investment Climate for Everyone”, World Bank http://siteresources.worldbank.org/INTWDR2005
World Bank, (2007). Gender and Economic Growth in Kenya: Unleashing the Power of Women, Directions in Development. World Bank, Washington, DC.
World Development Report (2005): A Better Investment Climate for Everyone - Summary (Russian). World Development Report.
Downloads
Published
Issue
Section
License
Copyright (c) 2019 Journal of Advance Research in Business Management and Accounting (ISSN: 2456-3544)
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Terms & Condition
Submission -
Author can submit the manuscript through our online submission process or email us at the designated email id in contact details.
The other mode of submission not accepted than online and email.
Before submission please read the submission guidelines.
NN Publication accepts only article submitted in pdf/doc/docx/rtf file format. Another format except given file formats will no be considered .
Author will be responsible for the error mistakes in the submission files. The minor changes can be done without any cost after publication. But for major changes NN Publication may charges you the editing charges.
Publication (Online) -
The online publication is scheduled on last date of every month, but it can be delayed by 24 to 48 hours due to editorial process if huge number of articles comes to publish in single issue.
Automatic notificatation email will be sent to the all users on publication of an issue, so its author’s duty to check their email inbox or SPAM folder to get this notification.
After publication of article author can not withdraw their article.
If editor’s found any issue after publication of article then the NN Publication have the authority to remove the article from online website.
No refund will be provided after online publication of article.
Publication (Print) -
The print copy publication are sent as per the author’s request after 2 weeks of online publication of that issue.
NN Publication will ship the article by India Post and provide the consignment number on dispatch of print copy.
NN Publication follows all the guidelines of delivery provided by IndiaPost and hence not responsible for delay in delivery due to any kind of reasons.
Refund of hard copy will not be provided after dispatch or print of the journal.
NN Publication will be responsible for raise a complain if there is any issue occurs in delivery, but still will not be responsible for providing the refund.
NN Publication will be responsible to resend the print copy only and only if the print copy is lost or print copy is damaged in delivery / or there is delay more than 6 months.
According to India Post the delivery should be completed with in 1-3 weeks after dispatch of articles.
Privacy Policy-
NN Publicationl uses the email ids of authors and editors and readers for sending editorial or publication notification only, we do not reveal or sell the email ids to any other website or company.
