CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The production of goods and services in the most efficient
manner has continued to be the only viable and reliable option for development, growth and survival of any economy. SMEs have been fully recognized by government and development experts as the main engine of economic growth and a major
factor by extension in promoting the realization of the financial systems strategy 2020. This is because the development of this sub-sector is an essential
element in the growth strategy, not only in contributing to improved standard of living; they also bring substantial local capital formation and achieve high level of productivity and capacity.
From a planning stand point, SMEs are increasingly recognized as the principal catalysts for achieving equitable and sustainable industrial diversification and
dispersal and in most countries SMEs account for well over half of the total share of employment, sales and value added (Udechukwu, 2003). This is not
surprising because the industrial sector in Nigeria has no significant record of meaningful contribution to economic development since independence in 1960
because it has not experienced any notable growth, traceable to indigenous industrial entrepreneurship (Adewale, 2007). The Nigerian economy, since the
early seventies, has been dependent on oil products. As a result of the enormity of revenue generated from oil, very little attention has been paid to proper
development of the industrial sector. The reason for the lacklustre performance of the industrial sector is mostly associated with the poor attention paid to
the promotion and development of the small and medium scale sub-sector, which is accepted worldwide to be the engine of economic growth and the basic
foundation for the industrialization process of any nation that desires to experience solid development. This is more so because entrepreneurship development is a critical aspect of skills development and keystone for economic revival and growth.
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