United Bank for Africa (UBA), one of Nigeria’s premier financial institutions, has recently entered into a Memorandum of Understanding (MoU) totaling $6 billion with the African Continental Free Trade Area (AfCFTA) secretariat.

The primary objective of this agreement is to provide financial support to Small and Medium Enterprises (SMEs), enabling them to capitalize on the opportunities arising from the implementation of the AfCFTA.

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The announcement was made by Babatunde Ajayi, the Head of SME Banking at UBA, during the Nigerian Canadian Business Association Business 2023 Roundtable held in Lagos.

Themed “Enabling Growth by Unlocking Access to Capital, Technology, And Markets,” the event aimed to address key challenges faced by SMEs in Nigeria.

Ajayi, while participating in a panel session, expressed concern over the fact that intra-African trade remains below 20%, lagging behind other continents.

He highlighted UBA’s commitment to allocating the newly signed $6 billion in partnership with AfCFTA to fund SMEs across Africa, with a specific focus on four sectors: Agro-processing, Automotive, Pharmaceuticals, and Transport and Logistics.

Sunny Omeiza, the Director of Trade Promotion at the Lagos Chamber of Commerce and Industry, shared insights during the roundtable, identifying energy, access to finance, and multiple taxation as persistent challenges for SMEs.

He emphasized that the high cost of production in Nigeria has rendered commodities produced by Nigerian SMEs less competitive compared to imported products.

Ebi Obaro, Chairperson of the Nigerian Canadian Business Association (NCBA), underscored the importance of three pillars – access to capital, technology, and markets – as crucial elements guiding SMEs in navigating the complexities of the global economy.

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She highlighted the transformative potential of technology, stating, “Technology is drastically changing the future of business and holds a lot of potential for small and medium-sized enterprises.

Our goal is to explore the many ways in which we can harness technology to improve efficiency and productivity in businesses in both Nigeria and Canada.”