Promoting SMEs Sector Development in Africa: Lessons from the “El-Rufai – Abuja Enterprise Agency” Model

In Abuja Nigeria, the end of the month of May this year witnessed the official handover of the nation’s leadership from one civilian government to another for the first time in the history of the country. That aside, it also marked the stepping down of several political office holders to give way for a fresh slate of leadership for the in-coming dispensation. Mallam Nasir El-Rufai, the ex-minister of the Federal Capital Territory (FCT) Abuja was among the political officers that stepped down and passed on the mantle of office to career civil servants under the ministry he served.

Beyond all reason doubt, El-Rufai has exemplified himself as one of the most admired ex-ministers of his time because of his very high sense of focus, dedication to duty, open policy, anti-corruption strides and courage in the discharge of his responsibilities while he served as minister. Under his leadership, the ministry undertook their duties of transforming Abuja to the comparable standard of all other seats of power in developed countries such as London and Washington DC. He made sure the FCT ministry did their job impartially without considering whose Ox was gored in the process. All these have brought about a widespread clamour for him to be returned as a minister of the Federal Republic, and moved into mainstream national development, where his efforts would not only be benefited in the FCT but by all and sundry in the country, especially the masses at grass-root levels.

However, the focus of this piece is to reflect on El-Rufai’s giant strides towards boosting and revamping the previously overlooked small to medium-sized enterprises (SMEs) sector within the FCT. Before 1999, Abuja the federal capital has always been termed a civil servant’s state or territory as business activities was in very low ebb. This was obviously because civil servants made up the largest proportion of the residents of the territory, and the culture of enterprise was relatively low and restricted to the unorganised market systems, several operators in the informal sector and a few in the formal real estate sector.

This was the commercial nature of the FCT that was inherited by El-Rufai on his appointment as Minister about 4 years ago, moving over from the Bureau for Public Enterprises (BPE) where he served as Director General. He quickly rolled-up his sleeves and settled down to work, knowing he needed to put some actions in place to change the “civil servant perception” of Abuja to a commercially viable territory that could attract external investments and engender the spirit of entrepreneurship amongst its residents.

As they say, the rest is history, and El-Rufai has made history for himself. Understanding the crucial role played by the SMEs sector in the area of providing goods and services, job creation, offering a better standard of living and boosting the economic growth and development of the region; the Federal Capital Territory Administration (FCTA) under his strategic leadership took deliberate efforts to key into the National Economic Empowerment and Development Strategy (NEEDS) of the nation.

Under the FCT Economic Empowerment and Development Strategy (FEEDS), the FCTA collaborated with two other partners, the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) and the United Kingdom’s Department for International Development through its State and Local Government Programme (SLGP) to establish the Abuja Enterprise Agency (AEA) with the major mandate of stimulating business growth in the FCT, thereby generating wealth, creating employment and reducing poverty within the territory.

AEA was made up of a team of highly educated and qualified technocrats, who have gained vast insight into the field of SMEs management and development over the years. An Executive Director was appointed for the agency in the person of Ahmed Tunde Popoola, a seasoned economist and banker whose experience of over 21 years spanned both the private and public sectors and possessed an deep-rooted knowledge in small business development, venture capital and project management to mention a few. The team also included both local and foreign trained experts in fields ranging from accounting, finance and supply chain management to development studies, business management and economics.

Assembling a team such as this brought to the agency a wealth of experience of over 100 years put together. Joining their heads together, the team started by setting-out several objectives for the agency such as: championing the awareness of the importance of entrepreneurship within the FCT; providing excellent support services to new and existing businesses; encouraging and promoting ethical business practices amongst the local business community; facilitating workspace for new and growing businesses; facilitating access to finance for viable business proposals, supporting businesses to overcome barriers imposed by bureaucratic bottlenecks and promoting the use of technology initiatives.

To date, the performances of the agency have been very laudable, resulting into widespread commendations within and outside the shores of Nigeria. Reports reveal that over 1,636 clients have benefited from the business advices of the agency’s outreach programmes designed to reach the rural poor in the towns and villages in Abuja; several thousands of participants have benefited from the business awareness workshops organised for various religious groups, youth associations, tertiary institutions and co-operative societies; about 1,304 participants have benefited from various training programmes such as how to start-up your own business, generate ideas, write a business plan and run a successful business; about 800 clients have benefited from over 6,000 sessions of business support and counselling services; about 600 persons visited the resource centre to access internet facilities and research business information; about 70 clients have benefited from the weekly business clinic organised in conjunction with the National Agency for Food and Drugs Administration and Control (NAFDAC) and the Corporate Affairs Commission (CAC), to support clients in getting information regarding incorporation and product registration.

That is not all. More interestingly, the agency has in conjunction with the FCT Social Development Secretariat Micro Credit Unit, ASO Savings and Loans, and Alliance Community Bank, disbursed over N50 million (US$347,000) to over 230 beneficiaries. There have also been linkages between young business people and experienced mentors to support the success and continual growth of their businesses. Even teenagers have not been left out in this “enterprise revolution” within the FCT as the agency have spearheaded the setting up of entrepreneurship clubs in about 25 secondary schools.

All these can be ascribed to visionary leadership of Mallam Nasir El-Rufai. When he has a vision, he communicates it, mobilises the necessary partnerships, marshals the required resources and assembles the right calibre of people to bring the vision to fruition. Today, Abuja is no longer referred to as a civil servant’s territory because the region is now setting the stage for other states and regions to follow. The FCT has also witnessed the creation of other agencies such as the Abuja Markets Limited and Abuja Investments aimed at further deepening the territory’s business activities by establishing markets and shopping centres, alongside other private initiatives.

The central key is in realising that a concerted and deliberate effort needs to be put in place to promote and encourage the small to medium-sized enterprises sector, which has for long been described as the “engine room” and “catalyst” in the development of many of the world’s greatest economies. It is high time African leaders at all levels, central, regional, federal, states and local government levels, whatever it is termed, borrow a leaf from this efficient and effective “El-Rufai – Abuja Enterprise Agency” model in order to transform Africa’s underdeveloped economies into first-world developed economies.

This article was written in June 2007.