coronavirus PANDEMIC'S IMPACT ON ANAMBARA STATE'S SMALL AND MEDIUM ENTERPRISES
Corona virus sickness served as the case study for an empirical investigation of the impact of viral epidemics on small and medium-sized businesses in the state of Anambra. This study's aims were to assess the prevalence of coronavirus disease in Nigeria and to assess the impact of coronavirus disease on the viability of small and medium-sized businesses in Anambra state. The study focuses on business owners in Nigeria. The infectious illness transmission mechanism theory served as a theoretical foundation. This study employs a survey research approach, and the population of interest comprises of all business owners across the country. 400 business owners were utilized as the sample size, and cluster sampling was used. The questionnaire serves as the instrument for this study. The information gathered came from original sources. The study of the data reveals that the incidence of coronavirus disease in Nigeria is comparable to that of other nations, and that the sickness has an impact on the survival of small and medium-sized businesses in the state of Anambra. As a result of the findings, it was suggested that measures be developed to halt the spread of the virus and that a vaccine be developed to prevent its further spread. Additionally, because the continued success of small and medium-sized businesses is dependent on their ability to operate online, it was suggested that business owners devise a way to continue their operations online. The study finds that coronavirus illness is detrimental to small and medium-sized businesses.
1.1 BACKGROUND TO THE STUDY
Since the beginning of time, regions and continents have remained relatively separated, with trade and the ambition to conquer other regions serving as the primary catalysts for interaction and racial mixing. However, technical progress, the technological gap, globalization, and tourism have led to an increase in international migration, and the national geographical boundaries of the world's states have become more permeable. This permeability has made it feasible for innovations and global ideas to be transmitted between continents, as well as for diseases and infections to spread from a local outbreak to a global epidemic and pandemic.
The Spanish flu was the first and mother of all pandemic outbreaks to strike the globe. Between 1918 and 1919, an estimated one-third (500 million) of the world's population was infected and had clinical symptoms. Recent research indicates that the deadly influenza did not originate in Spain, but rather in “Etaples,” a massive military staging camp in Northern France, where at any given time, more than one hundred thousand troops lived in close contact to pigs and poultry. In March of 1918, this lethal strain of influenza struck military training facilities in the United States of America where soldiers were awaiting shipping to Europe. From Camp Funston in Kansas, the virus spread to neighboring camps and then to Europe through troop ships. Within three months, 43,000 American soldiers perished to the sickness.
The majority of flu strains do not immediately kill people; rather, bacteria that invade the victim's weakened lungs are responsible for their demise. In 1918-19, however, the Spanish flu was a direct murderer. The victims were affected by acute cyanosis, which is a blue staining of the skin and mucous membranes. They vomited and coughed up blood, which also flowed uncontrolled from their noses and, in the case of females, their genitalia. As many as 71 percent of those infected perished among pregnant women. Invariably, if the pregnant lady lived, the fetus did not. The encephalitis virus ravaged the brains and spinal cords of a large number of adolescents. And millions suffered from acute respiratory distress syndrome, an immunological illness in which disease-fighting cells overload the lungs in their struggle against invaders, causing lung cells to become collateral damage and sufferers to choke.
The fatal Spanish Influenza virus was introduced to Nigeria by S. S. Bida, a merchant from the Gold Coast (now Ghana) whose passengers and personnel arrived from abroad. Consequently, the disease spread mostly through coastal ports. Transportation technological advancements aided in the disease's spread into the interior. Neither marine quarantine nor patient isolation was effective in preventing the spread of the disease. Between the 14th of September, when the outbreak was first recorded, and the middle of 1919, when it was finally forgotten, almost half a million Nigerians perished.
The Bubonic plague, smallpox, cholera, dengue, a novel strain of influenza, SARS, HIV/aids, Ebola, and the novel corona virus have also devastated large cities and states in Nigeria. The novel corona virus strain is a highly contagious illness, and the World Health Organization (WHO) has labeled it a global health emergency (Wang et al., 2021). In late December 2019, a case of unexplained pneumonia was reported in Wuhan, Hubei Province, People's Republic of China (PRC) (Huanget al., 2021). Experts from the PRC Centres for Disease Control (CDC) determined that new coronavirus pneumonia (NCP) was caused by a novel coronavirus, and WHO formally dubbed the illness COVID-19 (Huang et al., 2021). However, the International Committee on Virus Taxonomy (ICTV) designated the virus as severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). This type of -coronavirus contains numerous potential natural hosts, intermediate hosts, and definitive hosts.
Covid-19, as designated by the World Health Organization as the index case in Nigeria, was disclosed on February 27, 2021, when an Italian citizen in Anambra tested positive for the virus caused by SARS-CoV-2. On March 9, 2021, a second incidence of the virus was recorded in Ewekoro, Ogun State, in a Nigerian who had been in contact with the Italian. The infectious disease, with a fatality rate ranging from 2% to 5% in different geographic places and a recovery rate of more than 90%, rapidly spread throughout Nigeria's several states. Currently, there are about 76,207 confirmed cases, 671,100 discharges, and 1,201 fatalities. The virus is found in 35 states as well as the Federal Capital Territory (FCT).
The outbreak of COVID-19 was declared a global pandemic by the World Health Organization on March 11, 2021. To prevent the spread of the disease, numerous governments across the globe have enforced national lockdowns, which have precipitated a major fall in global economic activity. Numerous sectors of national industries across the globe have experienced a considerable decline in production, a decline in demand, and the elimination of jobs. Small enterprises are distinguished by their extraordinary adaptability, inclination for entrepreneurship, smaller production quantities, straightforward organizational structure, and informal internal communication (Lazarevic-Moravcevic, 2019, p.106). However, they tend to be more susceptible during economic downturns. Early indications suggest that the impact of the COVID-19 pandemic on small and medium-sized enterprises (SMEs) is greater than that of the 2008 financial crisis. Due to the fact that SMBs are the motors of economies.
Utilizing local raw materials and technology, small-scale businesses contribute to the attainment of self-sufficiency. Due to their contributions to the Nigerian economy, such as alleviating poverty, generating employment, enhancing human development, and improving the social welfare of the people, the Nigerian government formulates policies to facilitate and empower the growth and development of small-scale enterprises. Therefore, the only approach to alleviate poverty in a sustainable manner is to promote economic growth and development by creating jobs and wealth. UNIDO Report (2003), as referenced by Kehinde, Abiodu, Adegbuy, and Oladimeji, states that in some developing nations, small-scale businesses are the primary source of revenue, a breeding ground for entrepreneurs, and a major employer (2016).
The majority of registered firms in Nigeria are small-scale businesses, and they have existed for a considerable amount of time. Numerous small scale industries grew from cottage industries to small enterprises, and from small enterprises to medium and big enterprises. Small-scale business has been identified as a mechanism for the creation of job possibilities, offering the economy options for entrepreneurial training, development, and empowerment. In the Nigerian economy, small scale enterprise are the most prevalent form of business; the goal of any economy (whether industrialized or not) depends largely on how well small scale industries are managed; for instance, if we examine the standard practice of small scale industries in economically developed countries such as the United Kingdom or the United States, we can see that they rely heavily on small scale industries to reach out to the people (Etebefia & Kinkumi, 2013).
Globally, there is no particular criterion for categorizing businesses as small, medium, or large. In a research conducted by the International Labour Organization (ILO, 2005), more than 50 classifications for small scale industries were established by 50 different nations. Nevertheless, when defining small scale industries, quantitative measurements such as the number of people employed by the enterprise, the investment outlay, the yearly sales turnover (sales), and the asset worth of the enterprise, or a combination thereof, are typically referred to. Currently in Nigeria, according to the National Council for Industries NCI (2002), as cited by Etebefia & Akinwumi (2013), small scale industry is defined as an enterprise with a capital between N1.5 million and N50 million, including working capital but excluding the cost of land occupied, and a workforce between 10 and 50 employees. Currently in Nigeria, small scale industries account for approximately 90% of the industrial sector in terms of enterprise; they also account for approximately 70% of the national industrial development if the threshold is set at 10-70 employees and contributed 10% of the manufacturing sector output and a minuscule 1% of the gross domestic product; they also significantly contribute to economic development through employment, job creation, and sustainable livelihood.
In terms of the magnitude of the worldwide economic recession induced by the pandemic, the April-June 2021 economic estimates are becoming progressively pessimistic. In its June 2021 Economic Outlook, the OECD projected a 6% reduction in global GDP and a 7.6% decline in the event of a second pandemic wave by the end of 2021, with double-digit declines in some of the hardest-hit nations, followed by a minor 2.8% rebound in 2021. (OECD, 2021). This follows a prediction made in late March, which showed that the immediate direct impact of the shutdowns might be a loss in output of between one-fifth and one-quarter in many economies, along with a probable drop in consumer spending of approximately one-third (OECD, 2021).
In recent weeks, a number of other international organizations have produced economic effect projections for the coronavirus pandemic. The IMF June 2021 Economic Outlook Update predicts a drop in global GDP of 4.9% in 2021, which is 1.9 percentage points lower than the April prediction, followed by a partial recovery with growth of 5.4% in 2022. (IMF, 2021). The June 2021 World Investment Report (Unctad, 2021) predicts that global foreign investment would shrink by up to 40% in 2021, followed by a further decline of 5-10% in 2021.
The objective of this study is to investigate the impact of the global pandemic on the operational style of Medium and Small-Scale Businesses in Nigeria. The report examines the impact of the imposed border restriction and lockdown on corporate operations and the devastation of the financial sector brought on by the epidemic.
1.2 STATEMENT OF THE PROBLEM
The Covid-19 Pandemic impacted the global economy in two ways: first, the spread of the virus encouraged social distancing, which led to the closure of financial markets, corporate offices, and events; and second, the rate at which the virus was spreading and the heightened uncertainty about how bad the situation could get caused consumers and investors to flee to safety in terms of consumption and investment (Oziliand Arun, 2021). The restrictions placed on the movement of people in a number of nations resulted in enormous losses for businesses in the events, aviation, entertainment, hospitality, and sports industries. It was anticipated that the worldwide damage exceeded $4 trillion (Ozili, 2021). Due to cash flow problems, some SMBs cannot exist beyond one month (Farrel and Wheat, 2016). Thus, SMEs are at a significant risk of permanent closure after large-scale disasters, in part due to their inability to pay operating expenses while they are closed (Schrank, Marshall, hall-Phillips, Wiatt, and Jones, 2013). The coronavirus (Covid19) epidemic has wreaked havoc on the global economy and the lives of enterprises, regardless of their ability to maintain operations. These disruptions have a wide range of repercussions for businesses, and many are struggling financially (OECD, 2021). In many of the world's most industrialized economies, the average initial direct impact to the GDP level is between 20 and 50 percent (OECD, 2021). Many businesses have been forced to lay off workers, while others have been forced to restrict working hours (Edgecliffe-Johnson, 2021). The pandemic has caused major socioeconomic disruptions on a global scale, as well as the postponing or cancellation of sporting, religious, political, and cultural events, and widespread supply shortages (Turner and Akinremi, 2021). The combination of a decline in consumption and production interruptions in China has disrupted global supply networks, negatively impacting businesses worldwide (Fernades, 2021). As a result of the Covid-19 pandemic, several businesses have ceased operations, resulting in a massive disruption of trade and commerce across numerous industrial sectors. Retailers and brands are confronted with numerous short-term difficulties relating to labor, health and safety, cash flow, supply chain, consumer demand, sales, and marketing. Numerous markets, particularly in the hospitality and tourism industries, no longer exist, while online purchasing, online communication, and online entertainment have experienced unparalleled growth (Donthum, and Gustafsson, 2021).
During the lockdown, there has also been a surge in the use of social media and the internet (Donthum and Gustafsson, 2021). This is a result of the loneliness connected with lockdown, as individuals even prefer social media to actual interaction (Newland, Necka, Cacippo, 2018). Larger organizations may be better able to withstand shocks than small and medium-sized enterprises (SMEs) since they have greater financial resources (Verbano and Venturi, 2013). Environmental jolt or the possibility of an extreme event (Neyer, 1982) exposes a small- to medium-sized enterprise to elevated levels of strategic uncertainty, which has an effect on its day-to-day operations and may, in certain situations, threaten its survival (Sullivan-Taylor and Branicki, 2011). As a result of the Covid19 Pandemic, many nations throughout the globe are confronting unprecedented hardships (UNDP, 2021). The Nigerian people are not an exception. As Albert Einstein famously stated, “in every crisis lies a great opportunity,” the Covid-19 dilemma affords managers the chance to cultivate transiliency and thus be better prepared for the next Pandemic (Craighead, Ketchen, and Darby, 2021).
- PURPOSE OF THE STUDY
This study seeks to investigate COVID-19 and its effects on the viability of small and medium-sized businesses in Nigeria. The report analyzes the following important goals in detail:
To investigate the impact of the COVID-19 imposed lockdown on the operation of small and medium-sized enterprises (SMEs) in Anambra State, Nigeria; To investigate the sustainability strategies adopted by SMEs during the imposed COVID-19 lockdown in Anambra State, Nigeria; To investigate the current challenges facing SMEs as a result of the COVID-19 pandemic in Anambra State, Nigeria.
1.4 RESEARCH QUESTION
The research attempts to address the following research questions:
What effect does the COVID-19 lockdown have on the operations of small and medium-sized enterprises (SMEs) in the Nigerian state of Anambra?
During the COVID-19 lockdown in Anambra State, Nigeria, what sustainability methods did small and medium-sized enterprises employ?
As a result of the COVID-19 outbreak in Anambra State, Nigeria, what obstacles do SMEs currently face?
1.5 SIGNIFICANCE OF THE STUDY
This study's conclusion and findings provide light on the economic impact of the COVID-19 pandemic on the operations of small and medium-sized companies in the state of Anambra. The outcome will shed light on the financial repercussions of the lockdown and the susceptibility of SME's to external environment constraints. In addition, the results of the study demonstrate the precarious condition of many small and medium-sized enterprises (SMEs) in Nigeria, as well as the severe impact COVID-19 had on these firms in the weeks following the onset of COVID-19-related disruptions. In addition, the results shed light on businesses' expectations on the long-term effects of COVID-19 and their perceptions of government-sponsored relief initiatives.
1.6 SCOPE OF THE STUDY
This study examines the many conceptual aspects surrounding COVID-19 and its effect on small and medium-sized businesses in Anambra state, Nigeria. The research will encompass the regions of Ojo, Alaba, Okokomaiko, and Trade Fair. The geographical scope is chosen by the researcher since it is close to her place of study, Anambra State University, and hence provides simple access and convenience.
1.8 ORGANIZATION OF THE STUDY
There are five chapters in this work. What each chapter consists of is described in detail below:
Background of the study, statement of the problem, purpose of the investigation, research questions, research hypotheses, significance of the study, delimitation of the study, organization of the study, and definitions of key terminology are covered in the first chapter.
Economic Crisis and covid-19, COVID-19 Spillover on the Nigerian Economy, Utilizing Fiscal and Monetary Policy Measures, Structural factors aggravating the economic downturn, Small and Medium Scale Enterprise, SME in Nigeria, Contributions of Small Scale Business to Economic Development in Nigeria, SME in Latin America and Other Regions Principal SME funding sources in Nigeria, The Character of Small Business, Government Intervention in Small-Scale Enterprises, Challenges of Small Scale Enterprises in Nigeria, Government Intervention to Stimulate the Establishment of Small Scale Enterprises, Prospects of Small-Scale Enterprises, Survival of Small-Scale Businesses in a Turbulent Environment, Factors in an Organization's External Environment, Covid-19 and SME in Nigeria Digital Transformation and SME Sustainability in COVID-19
The third chapter presents the research methodology by analyzing the research design, area of study, sources of data collection, instruments for data collection, population of the study, sample and target population sample size sampling procedure data collection and analysis techniques to be employed.
The fourth chapter covers data analysis, presentation, interpretation, and discussion of results.
As a summary of the study's findings, the fifth chapter provides recommendations and conclusions.
1.8 OPERATIONAL DEFINITION OF TERMS
SMEs refers to firms with low capital and a small number of employees.
Sustainability refers to the ways and strategies employed by business owners to stay afloat and thrive.
COVID-19 is an unique kind of coronavirus that is transmissible from person to person by physical contact.
Lockdown: The imposition of restrictions on the movement of people across geographic borders and within a state in an effort to prevent the spread of an infectious disease.
Social distancing, also known as “physical distancing,” refers to maintaining a safe distance between yourself and non-household members by maintaining a distance of at least 6 feet (about 2 arms' lengths) in both indoor and outdoor environments.
Work from home (WFH) is when an employee works from their home, apartment, or other place of residence instead of the office.
CORONAVIRUS PANDEMIC'S IMPACT ON ANAMBARA STATE'S SMALL AND MEDIUM ENTERPRISES