There has been a lot of global discussion about the role of small businesses in the development of economy, and particularly in light of new tariffs imposed by the Trump administration and, accordingly, by governments across Europe and Asia. Although many economists claim that small businesses are not in fact the backbone of economy, and that large corporations bring modernism to society, the importance of small businesses to the economy is undeniable and goes beyond the domain of direct contribution to revenues.

Without small businesses, and particularly in countries like Nigeria, economy would collapse. In Nigeria 27% of the country’s trade balance comes from small businesses, but more importantly they employ 60m Nigerians and contribute 48% of the GDP. Without small businesses, the unemployment rate would soar from 14% to as much as 50%, causing nothing short of chaos. Nigeria needs thriving and healthy small businesses (while sorting out issues such as licensing).

Small businesses also drive innovation. The true entrepreneurial spirit cannot survive in a business environment dominated by corporations. The United States may be the world’s strongest economical and financial power right now but it is facing a severe crisis when it comes to creativity and innovation.

So what in fact can be done to help small business thrive?

One key aspect in improving the business environment as a whole, and specifically in Nigeria, is to enable businesses to borrow money easily. Access to funds is always challenging for small businesses, and aside from the newly launched Micro Credit there are few options. The banking system is still archaic and cumbersome. Larger corporations may navigate their way around the simmering water (through ethical or unethical methods) but small business are often stuck and have to close down due to cashflow issues.

Nigeria should learn from countries where borrowing small amounts of money for short periods of time is loosely regulated. Countries like the UK, the USA, or Australia. Australia is 80% smaller than Nigeria and there is an immense number of small business lenders that enable small businesses to borrow funds within a day or two online.

Another thing that should be fixed immediately to enable Nigerian-owned small business to thrive is to reduce the costs and complexity of bureaucracy related to small business registration. Not only it encourages small businesses to evade taxes and operate illegally, it also puts an unnecessary strain on the businesses that do register properly and pay their taxes in full.

The bottom line – small businesses are an integral part of any country’s economy but in Nigeria there is a particular reliance on them as an economic driver. If Nigeria wants to keep its upward- trending status in global economy, there are immediate measures to be taken.