MSMEs Drive 50% of Nigeria’s GDP and 84% of Jobs – Minister
Micro, Small, and Medium Enterprises (MSMEs) are the backbone of Nigeria’s economy — contributing about 50% of the nation’s GDP and generating over 84% of employment, according to Jumoke Oduwole, Minister of Industry, Trade, and Investment.
Oduwole, representing Vice President Kashim Shettima at the launch of Moniepoint’s 2025 Nigerian Informal Economy Report in Abuja, emphasized that these figures reflect the strength, creativity, and resilience of Nigerian entrepreneurs who continue to drive growth despite economic challenges.
“Nigeria is home to more than 39 million MSMEs, accounting for about 96% of all registered businesses. From artisans and market traders to tech-driven startups, millions of Nigerians power commerce daily in ways often unseen but vital to our economy,” Oduwole said.
She described the informal sector as the “heart of Nigeria’s entrepreneurial story”, applauding small business owners and digital entrepreneurs for sustaining trade and services across the country.
Government Commitment to MSME Growth
Oduwole reaffirmed the government’s commitment to supporting MSMEs through improved access to finance, simplified business registration, and capacity-building initiatives that empower entrepreneurs to scale sustainably.
She also referenced trade incentives under the African Continental Free Trade Area (AfCFTA) aimed at expanding market access for Nigerian businesses. Among these are gazetted tax concessions for duty-free intra-African trade and the launch of the Adegboye Export Corridor in partnership with Uganda Air — connecting Nigeria to 13 Southern and Eastern African markets with air freight discounts of up to 75%.
“AfCFTA is no longer just a policy concept — it’s a $3.4 trillion marketplace of 1.4 billion people. Nigerian entrepreneurs must position themselves to serve this continental market,” she added.
Key Insights from Moniepoint’s 2025 Informal Economy Report
The Moniepoint report revealed both resilience and vulnerability within Nigeria’s informal economy.
- 65% of informal businesses recorded revenue growth in the past year.
- However, only 47% reported higher profits due to rising operating costs.
- Cash transactions remain dominant, though nearly half of MSMEs now pay suppliers via bank transfers.
The report also identified major challenges, including limited access to finance, poor infrastructure, low digital adoption, and weak business structures. Moniepoint advised that expanding financial literacy programs and affordable digital tools could help informal businesses improve productivity and financial stability.
Despite the economic headwinds, many small businesses have remained afloat through mobile banking, digital payments, and community savings groups. Moniepoint and the minister both urged policymakers and financial institutions to strengthen their support for these enterprises, ensuring long-term sustainability for Nigeria’s largest employment sector.
Key Takeaway:
With MSMEs contributing nearly half of Nigeria’s GDP and employing over 84% of the population, empowering this sector is vital to Nigeria’s economic stability. Government-led reforms, digital inclusion, and AfCFTA-driven trade expansion could significantly accelerate small business growth in 2025 and beyond.
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