FG explains GEM project’s operations, interventions

THE Federal Ministry of Industry, Trade and Investment (FMITI), has explained some of the misconceptions regarding the World Bank Growth and Employment Project being implemented by the ministry.

According to a statement from the Ministry, GEM, a $160 million World Bank-funded project, being implemented by FMITI has been a success story, contributing to the diversification of the Nigerian economy, by supporting sectors that have high growth potential and create massive employment. The Ministry reiterated that, at the end of 2016, the World Bank rated the GEM project “unsatisfactory and underperforming” and considered scrapping it.

“After three years of operation, the project had low deployment and was not meeting its job creation and economic development objectives, so it had to be restructured”, it added.

The Ministry noted that the project supports micro, small and medium-sized enterprises (MSMES) operating in five high potential sectors of the economy, namely: ICT, entertainment, tourism, hospitality, light manufacturing, and construction.

“The restructuring carried out in conjunction with the World Bank Team were as follows: Strengthening the management team to deliver on the promise of the GEM Project; deploying more funds directly to SMES, as opposed to using intermediaries; modifying the project’s existing equity window to an SME investment fund, this is a proven mechanism for boosting growth, creating jobs and increasing entrepreneurship; improving the coordination and partnership with the World Bank; and extending the duration of the programme to ensure that the results can positively affect and reach more Nigerians.”

“Highlights of restructuring included the restructuring of Project Implementation Unit (PIU) – focused leadership with new leadership; better and faster disbursement of Funds; more allocation directly to the SMES, as opposed to consultants and intermediaries (the allocation to consultant reduced); and change of ineffective programmes and introducing new ones; the private equity window was changed to SME Investment Fund”, the Ministry added.