The Effect of Government Policies on the Survival of Small Businesses:

Evidence from Nigeria

Boniface, Umoh E.
Email: bontechsearch@gmail.com (+234) 8038925441.
ABSTRACT
This research investigates the effect of government policies on the survival of small businesses in Nigeria, focusing on
three key areas: government credit policy, tax policy, and licensing policy. Specifically, the study examines how each of
these policies affects the sustainability of small businesses in the context of the frozen fish sector in Enugu Metropolis.
The firms included in the study are Up Town Frozen Fish & Meat Shop, Lizzy Fish Shop, Conyfrost Coldroom, Titus
Fish Frozen, and Fresh & Frozen Seafoods and Poultry. Using a descriptive survey design, the study gathered primary
data through a structured questionnaire from a sample of 124 respondents. Data analysis was conducted using
descriptive statistics and regression analysis with the aid of SPSS Version 25, at a 5% significance level, complemented
by a SWOT analysis. The findings reveal that while government credit policies have a significant positive impact on the
survival of small businesses, government tax and licensing policies show no substantial effect. The study concludes that
while government regulations influence small business survival in Nigeria, certain policies, particularly those related
to taxation and licensing, may need reevaluation to minimize negative impacts. The research recommends that
governments at all levels revisit these regulations to foster a more supportive environment for small businesses,
particularly in Enugu State.
Keywords: Government policies, credit policy, tax policy, licensing policy, and small businesses survival
INTRODUCTION hurdles (Mohammed & Bunyaminu, 2021).Governments
Small enterprises (SEs) are widely regarded as key within the region have implemented various policies
engines of economic growth, employment creation, and aimed at fostering SME development, such as tax
creativity. As to the World Bank, SEs generates up to incentives, loan schemes, and capacity-building
forty percent of national revenue in emerging nations programs. However, the effectiveness of these
and account for ninety percent of businesses globally interventions has been mixed, with many SMEs
(World Bank, 2021). Governments across the globe play struggling to survive due to systemic issues, political
a vital part in forming the business environment through instability, and inconsistent policy implementation.
policies that directly impact the growth and sustainability SMEs are crucial to sub-Saharan Africa's (SSA)
of these enterprises (ILO, 2022). Recent shifts in fiscal economic development, growth, and employment
and regulatory policies, particularly in response to global creation (Williams and et al, 2025). Countries like
economic challenges such as the COVID-19 pandemic Nigeria, South Africa, and Kenya have taken notable
and inflationary pressures, have intensified the need for steps to prioritize SME growth, albeit with varying
targeted government interventions to support small degrees of success.
businesses (World Bank, 2021). However, the
effectiveness of these policies often varies, influenced by In Nigeria, SMEs are credited as a vital part of the
the unique socio-economic contexts of different nations. economy and have emerged as important sources of
According to UN reports Micro-Small and Medium- employment, employing a sizable portion of the
sized Enterprises (MSMEs) continue to be the backbone workforce, where unemployment rates have long been a
of the economy in the majority of civilisations, making problem. They have also made a significant contribution
up 90% of enterprises, over 70% of jobs, and 50% of to job creation and poverty reduction (Oluremi & Maku,
global GDP (United Nations, 2024). 2024). The Nigerian Bureau of Statistics (NBS) reports
that SEs make up over 96% of Nigerian businesses and
In Africa, SMEs constitute approximately 80% of contribute 50% of the nation's GDP (NBS, 2022).
businesses and employ over 50% of the workforce,
according to the African Development Bank (AfDB, According to the 2022 Nigerian MSME Report, nearly
2021). Despite their significance, small businesses in the 95% of SMEs shut down within the first five years of
region face considerable challenges, including limited operation. Additionally, Adeforiti (2023) noted that the
access to finance, poor infrastructure, and bureaucratic number of SMEs in Nigeria declined from approximately

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41,543,028 units in 2017 to 39,654,385 units in 2020, controlling expenses, and issues with the dumping of
reflecting a reduction rate of 4.5% over this period. This low-cost imported goods (Orga, et al., 2020).
ongoing decline has contributed significantly to the
challenges facing Nigeria's economy, including high A recent survey indicates that almost eighty percent of
unemployment, persistent poverty, and low economic Small Enterprises fail before they reach 5 years of
growth. One of the main factors influencing the survival existence. These failures are attributed to unfavourable
and growth of small enterprises (SEs) is government economic conditions, limited capital availability, and
regulations, which play a crucial role in developing inadequate corporate governance that prevent small
policies to support their development (Obananya, 2022). businesses from growing and changing. It also said that,
despite economic growth and the potential for economic
Policies can develop solutions for issues facing small opportunities, there were barriers in the Nigerian
businesses while recognising the interests of different business climate that limit the ability of businesses to
groups that are connected to the business and are survive in the country (Edidiong, 2023). It found that one
occasionally referred to as applicants for the operation. of the main obstacles that have harmed a lot of the
Obananya (2022) anticipated that different levels of nation's small enterprises is the existence of double
government enact labour and antitrust laws, mandate taxation. Exactly thirty-nine of the one-hundred and
product labelling, impose taxes, and implement a host of nineteen fees and charges permitted by the taxes and
other rules and controls. The importance of government levies (Approved list of collection) Act 1998 were really
policymaking and national policy goals include raising being charged by different levels of government,
output, lowering inflation, cutting employment, reducing according to a survey that was recently conducted by
economic inequality, and creating a trade balance. The MAN (Manufacturers Association of Nigeria).
government ensures policies in order to guarantee the
possibility and implementation of defined objectives. Two factors affect small enterprises' ability to survive:
internal and external variables. Fundamental economic
The importance of the small company sector to a problems that arise outside the control of the company
country's economic growth and attempts to fight poverty and affect its ability to do business are known as external
is well known. Small businesses are the cornerstone of factors. Fundamental business elements that arise within
economic growth, job creation, and poverty reduction in the organisation and affect how it does business are
emerging countries. They have been the vehicle for referred to as internal factors (Sarah, 2023). Competitors,
achieving quick industrialization and increased economic culture, technology, infrastructure, and government
prosperity. Remarkably, small businesses have been policy are examples of external drivers; entrepreneur
acknowledged as a source of growth for large-scale abilities, dedication, resource, and strategic decision are
enterprises (Orga, et al., 2020). Small-scale business examples of internal ones. In light of this, the study
owners in this industry face numerous challenges that examines the impact of these recent legislative changes
restrict their long-term survival and growth, despite the on the viability of small businesses, highlighting the
valuable contributions made by these enterprises. advantages, restrictions, and potential areas for
Academics have suggested that beginning a business is a development in Nigeria's policy framework with a
stressful endeavour and caution that small business particular focus on the frozen fish industry in Enugu
owners in Nigeria have a slim chance of success. Metropolis.

Even with government support and incentive As a major source of protein for the populace, the frozen
programmes for small businesses, one would think that fish industry is vital to Enugu Metropolis' local economy
in Nigeria, these enterprises would expand and thrive. and food supply chain. Being a sector of small
However, the rate of business failure keeps rising due to businesses, it is an important portion of the informal
various obstacles to business performance, such as a lack economy, which is extremely susceptible to government
of capital, lack of managerial expertise, unfavourable regulations, especially those pertaining to financing,
environment, statutes and ordinances, overall economic taxes, and licensing. The study adds significant
circumstances, and essential components including knowledge to the larger problem of small company
poverty, corruption, insufficient amenities, and a sustainability in Nigeria by examining how government
shortage of demand for goods and services generated loan, tax, and licensing policies affect these companies.
locally are all factors (Wasiu, 2019). Additional factors
include the scarcity of raw materials, poor financial
resources, incompetent management, difficulty

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Statement of the Problem REVIEW OF RELATED LITERATURE
Due to the inherent risk of entrepreneurship, managing a Conceptual Review
small business is not for the faint of heart. Successful DEPENDENT
entrepreneurs must be able to lower risks specific to their INDEPENDENT
VARIABLES VARIABLE
company and launch a product or service at a price that
meets consumer demand. Insufficient finance or cash,
employing the incorrect management team, having a Government
poor infrastructure or business strategy, and creating Policies
unsuccessful marketing campaigns are the most common
reasons why small businesses fail. Small businesses
might suffer from a lack of expertise in business Credit
administration, poorly thought out business strategy that Policy Survival of
can cause problems even after the company opens for Small
business, and a reluctance to delegate. Inadequate Businesses
Tax
promotion and exposure, badly planned or executed Policy
marketing campaigns, and other issues are some of the
other issues that small businesses face. In order to reduce
Licensing
the gap, this study assessed how government policies
Policy
affected small-scale business survival in Nigeria.

Objective of the Study Figure 1: Author’s Conceptual Model, 2025

The specific aim of the study include to:
i. Examine the effect of government credit policy on Government Policies
the survival of small businesses in Nigeria. Government policies are laws and guidelines that support
ii. Determine the effect of government tax policy on the the establishment and long-term sustainability of
survival of small businesses in Nigeria. commercial companies. Some regulations directly affect
iii. Assess the effect of government licensing policy on company owners, while others are targeted at certain
the survival of small businesses in Nigeria. industries. For instance, in Nigeria, agro-allied
businesses usually enjoy tax exemptions for the first five
Research Questions years of their existence. While small businesses are not
i. What is the effect of government credit policy on the subject to taxes, certain firms do get subsidies.
survival of small businesses in Nigeria? Moreover, regulations that prohibit the importation of
ii. How does government tax policy affect the survival manufactured products often serve to protect homegrown
of small businesses in Nigeria? companies and encourage business ownership (Salami, et
iii. To what extent does government licensing policy al., 2023).
affect the survival of small businesses in Nigeria?
The entrepreneurial environment on the continent is
Statement of Hypotheses significantly shaped by government policies (Elumelu,
Ho1: Government credit policy has no significant 2023). SMEs and the creation of wealth and jobs that
positive effect on the survival of small support a nation's economic progress are intended to be
businesses in Nigeria limited by government policy. Government policy
Ho2: Government tax policy has no significant positive support agencies are organisations that work to improve
effect on the survival of small businesses in and adapt small businesses' standing with regard to
Nigeria. government financing, execution, and support. The goal
Ho3: Government licensing policy has no significant of government support organisations for small
positive effect on the survival of small businesses is to establish a environment that supports
businesses in Nigeria. business acumen and SBs growth by enacting laws that
favour them. This is done through enacting legislation
governing policies that assist and lessen the issues faced
by small enterprises, which are the cornerstone of the
country's industrialization journey. Policies that are easy
for small businesses to use must be approved by the
government (Adegboyo, et al., 2021). Well-developed

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infrastructure works in combination with a favourable the creation of venture capital firms or offer loan
political and business environment to support a guarantees for small businesses can greatly increase the
flourishing business conditions, enhanced output of amount of capital available to entrepreneurs. By
products and services, as well as the creation of value lowering the risk, these programmes entice investors to
(Uju & Ugochukwu, 2021). fund businesses.

The establishment of rules and regulations that regulate Government Tax Policy
the growth of small companies in Nigeria is necessary All around the world, governments impose taxes on their
for the successful implementation of government residents, business organisations, goods, and services in
regulations related to small businesses in the area of order to raise money to pay for their spending. The tax
economic development, according to Obananya (2022). system is largely to blame for small firms' expansion.
When it comes to laws, it is believed that the government Value-added tax, withholding tax, and personal income
will be the main driver of small business growth and be tax are all payable by small enterprises in Nigeria.
able to provide much-needed resources. One of these Previously, though, they were liable to corporate income
resources is the capacity to foster an environment that tax. The Finance Act of 2019 modifications, which
supports small businesses and promotes their growth. A exempt small firms from paying taxes, have caused this
policy is a course of action that has been chosen and to change (Atoyebi & Ayara, 2022).
endorsed by a political party, organisation, or group of
people. Yet, the overall government control of the Due to the difficulties in obtaining their income owing to
economy in which small businesses operate frequently a lack of appropriate documentation, the majority of
renders these business policies ineffective (Obananya, SMEs are subject to presumed taxation. The government
2022). Therefore, small businesses in the economy have can access the taxpayer based on their imagined income
limited direct control over government policies, which thanks to presumed taxes. Tax laws that provide tax
are externally mandated. vacations or lower tax rates to small and medium-sized
businesses can encourage entrepreneurship and cut
Government Credit Policy operating costs (Elumelu, 2023).
Government credit policies are a tactic used to assist
small-businesses long-term growth objectives by giving Consequently, legislators should prioritise setting up the
the government influence over credit and lending tax code to support the expansion of situation-specific
options. One of these strategies is to prepare and look for SMEs. The government applies a variety of taxes with
rules, including concessionary funding, to support and the intention of safeguarding emerging sectors and
promote the growth of small businesses in Nigeria ensuring fair competition among small firms, all in the
(Obananya, 2022). name of defending and managing the operations of small
businesses.
Government financial policies and bank lending rates
have the potential to impact the economy, according to Jialu (2022) asserts that tax regulations have an impact
Yimka et al. (2020). Investment declines as interest rates on how businesses are organised, how much money is
rise because entrepreneurs would not borrow money at saved, how people migrate across state lines, and how
unprofitable rates. Governments design the structures they invest. A high import tax rate would incentivize
and regulations that allow companies to compete with local business owners to manufacture goods
one another. The government will occasionally alter domestically. However, a high raw material tax rate will
these regulations and frameworks, requiring companies promote imports and discourage home manufacture.
to modify how they conduct business. Therefore, tax responsibilities and high tax rates
discourage small enterprises from growing.
Thus, government regulations greatly affect businesses. Economically speaking, taxes increase the cost of
Another economic policy set by the government is the manufacturing goods and services, which eventually
interest rate. The Monetary Policy Committee of Nigeria raises the price for consumers.
convenes on a monthly basis to decide on the interest
rates that are implemented throughout the economy. For It is clear that taxes are the main issue for both new and
example, an increase in interest rates drives up operating established businesses. However, it was recommended
expenses and also reduces consumer purchasing power, that small enterprises be able to fulfil their potential tax
which in turn drives down business sales. According to obligations in a tax-friendly environment. Businesses'
Elumelu (2023), government initiatives that encourage bottom lines will suffer even though they might be able

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to pass some of this tax on to customers in the shape of enterprises operate an important role in promoting the
increased prices. Other business taxes include the value- expansion of employment and the production of wealth.
added tax (VAT) and environmental levies like the They play a crucial role in linking the country's
landfill tax. The final customer is responsible for paying advancements in services, industry, agriculture, and
the VAT tax, and businesses incur significant costs for many other areas. Sustainable growth increases small
managing the system. It is indisputable that taxes have businesses' competitiveness and productivity while
many benefits, but if many taxes aren't checked, the opening up a plethora of opportunities for employment,
troubles they cause may outweigh the benefits. the purchase of material and intangible assets, and
Accordingly, people, companies, and corporate entities foreign investment in the country (Ndayako, 2021).
voice their dissatisfaction with the negative Nigeria's economy is growing because of small
consequences linked to tax doubling (Mbazulike, et al., enterprises.
2023).
Enterprises are categorised as small or mid-size if their
Government Licensing Policy revenue, assets, or labour falls below a certain threshold.
A government business licence is the permission granted Each nation has a different concept of a small- to
by the federal government or the local government of the medium-sized business. The organization's approach to
area in which you currently reside to establish a business business of operation can sometimes been considered, in
or engage in a specific industry. Therefore, a business addition to needing to follow certain size guidelines
permit is a formal document that permits companies, (Berry-Johnson, 2019). Small- to medium-sized firm in a
particularly those with foreign interests, to operate developed country may be regarded as a large-scale
locally. business in a developing country when factors like fixed
investment and workforce employment are taken into
Government licencing presents significant obstacles to account. The following table displays the meaning of a
the growth of small enterprises and necessitates SME as provided by the European Commission.
extensive structural reform (Obananya, 2022). Exorbitant
licencing and registration fees have an impact on the Table 1: SME Definition in European Commission
expansion and operations of small firms. Depending on S/N SIZE Full time Sales Turnover ($)
the jurisdiction, a business licence may serve several CATEGORY Labor
purposes. In certain instances, it might be necessary to 1 Micro 1-10 0 – 2,591,600
sell particular goods or take part in particular activities. Enterprises
In other cases, it might only be an administrative step to 2 Small 10 - 49 2,591,600 –
make sure companies are informed about and following Enterprises 12,958,000
relevant rules and regulations. 3 Medium 50 – 249 12,958,000 –
55,719,400
Business operations are likely to be restricted by a legal Source: European Commission Official Website, 2022
and authoritarian structure that leads to unduly
complicated licencing and registration procedures as Table 1 shows that small businesses with 10–49 staff
well as time-consuming and expensive reporting members shouldn't have a turnover exceeding
procedures (Obananya, 2022). The process of obtaining a $12,958,000 (or EUR 10 million); medium-sized
business licence is another area that most businesses businesses with 50–249 staff members need to not have a
view as cumbersome. Small companies revealed that turnover exceeding $55,719,400 (or EUR 50 million);
there was no clear explanation that scholars, statistics and small enterprises with no more than ten workers
agencies, or economies could use as a guide. Elumelu ought not have a turnover exceeding $2,591,600 (or
(2023) asserts that expediting the licencing and EUR 2 million). According to the European Commission
registration procedure for enterprises can lower Official Website (2022), SMEs are characterised by a
administrative barriers and motivate more people to variety of factors, including as capital, project scope and
formalise their operations, increasing transparency and cost, yearly revenue, financial stability, and personnel
opening up formal finance sources. size.

Small Businesses The Central Bank of Nigeria (CBN) categorised Nigerian

A small-scale firm comprises a company that is privately SMEs based on their workforce size and asset base. The
held, operated and does not command a monopoly in its requirements include an asset base of at least five million
sector. In the nation's economic structure, small Naira and a workforce of at least 100,000 Naira.

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According to the Federal Government's 1980 Small Table 4: Insights on the MSME sector in selected
Scale Sector Development Plan, a company in Nigeria's countries
industrial or service sector is deemed small if its total Country % of GDP Employment
capital expenditures, including equipment and businesses
production costs, do not exceed N150,000,000.00. South Africa 99% 52% 29%
According to Ogonu and Okejim (2018), The Federal USA > 99% 44% 48%
Ministry of Commerce and Industry's (FMCI) small- UK 99.7% 51% 54%
scale industries section defines small-scale firms as those Germany 99.5% 54% 63%
that employ 50–150 people and have a capital Nigeria 99.8% 49% 84%
investment of N250,000. Like many others, this Source: European Commission, FMITI, PwC research
definition considered the number of employees and the
amount of money invested. According to the updated National Micro, Small, and
Medium Scale Enterprise Policy (2021–2025), Nigeria's
Different countries have different definitions of Micro, MSMEs are now categorised as follows:
Small, and Medium-sized Enterprises (MSMEs) and
from organisation to organisation in terms of the total Table 5: Insights on the National Micro, Small and
assets, annual turnover, and number of employees. Here Medium Scale Enterprise Policy
are a few definitions from eminent Nigerian S/N Size category Employment Turn over (N
organisations that deal with SMEs. The present research million)
has utilised the BOI definitions and categorization of 1 Nano/ 1-2 Less than 3
MSMEs. Homestead
Enterprises
Table 2: Bank of Industry’s (BOI) Definition for Micro, 2 Micro 3-9 3-25 million
Small, and Medium-size Enterprises Enterprises
S/N Enterprise Micro Small Medium- 3 Small 10-49 25+ but less
Category/ Enterprise Enterprise size Enterprises than 100
Indicator enterprise
4 Medium 50-199 100+ but less
1 Number of ≤ 10 >11 ≤ 50 > 51 ≤ than 1000
Employees 200
Source: National Policy on MSMEs in Nigeria, 2023
2 Total Assets ≤ 5 > 5 ≤ 100 > 100 ≤
(₦) million million 500 Small Business Survival
million The ability of SMEs to leverage their unique assets to
3 Annual ≤ 20 ≤ 100 ≤ 500 stimulate the economy is based on how viable their firms
Turnover million million million are. However, poor business survival rates are widely
(₦) acknowledged as a concern facing the SME sector.
Source: BOI, PWC Survey, 2020 Approximately 20% of start-ups leave the market during
their first year of operation, and more leave the
Table 3: SMEDAN National Policy on MSMEs following year. A mere minority embark on a trajectory
Definitions of rapid expansion (Sasan et al., 2020). Only 39% of
S/N Indicator / Micro Small Medium- newly established businesses in Australia make it to the
Size of the Enterprise Enterprise size age of ten, with 24% leaving within the first three years
Enterprise enterprise (Bakhtiari, 2019). According to Enesi and Ibrahim
1 Number of ≤ 10 10 to 49 50 to 199 (2021), SMEs have been negatively impacted by
Employees outbreaks since 2020, and they continue to do so. They
2 Total Assets ≤ 5 ≥ 5 < 50 ≥ 50 < also noted that epidemics constitute a detrimental effect
(₦) million million 500 on the economy through poor health. Healthcare is an
million essential component and an engine for achieving wealth
Source: MSME Survey, 2020 through financial growth and development. As such,
business activities are unable to flourish adequately
without the support of an effective healthcare system and
a positive business climate. The new virus that was
plaguing the world economy had a major detrimental

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effect on the SMEs under study's cash flow and customer surprise that the idea of survival of the fittest is most
base. This incident generated negative sentiments about frequently applied in economics to assess how
survival, excitement, and the pandemic's further businesses compete and prosper across a range of
expansion. Numerous companies have failed and many industries and to explain economic shifts (Broom &
more are in danger of collapsing because of the COVID- Long-Necker, 2002). In "The Origin of Strategies," he
19 pandemic. This led to economic shock for most SMEs makes the case that competition could have existed from
with little capital investment, from which they are the dawn of time and even predated strategy. Since it
unlikely to recover fast (Enesi & Ibrahim, 2021). made no sense for two similar firms to serve the same
clients and serve the same purpose because one of them
Theoretical Review would inevitably fail, he argued that in order for a
Resource Based Theory business to succeed, it needed to differentiate itself from
The resource-based approach was first presented by its competitors.
Penrose (1959) in her essay "The theory of the Growth
of the firm." Resource diversity and resource immobility The notion that companies must adopt strategies that are
are the two fundamental tenets of the resource-based focused on functioning very effectively and swiftly adapt
paradigm of the enterprise. When a company has a to changing competitive conditions are the foundation of
resource or capability that is also possessed by a large the survival-based paradigm in strategic management.
number of rival companies, it is said to have diverse This is because the entity that survives is the most
resources and cannot give it a competitive edge. adaptable and fit to its surroundings. According to Mc
Resources that are difficult for rivals to access due to Donald, this is one of the success stories that best
high development, acquisition, or usage costs are said to supports the Darwinian idea of the survival of the fittest
be immobile resources. (Oshunbiyi, 2004). It was suggested that McDonald's
success story was due to its capacity to adjust to a high
By offering a framework for evaluating whether a degree of efficiency into the fast-paced environment of
method or technology offers a genuine edge over the contemporary life and an effective workplace.
competition, the aforementioned presumptions are Nonetheless, some of this viewpoint's supporters
utilised to assess if small business owners can develop a contended that choosing a certain set of tactics would not
sustained competitive advantage. According to the be the best course of action. Rather, It is better to test
resource-based perspective, small businesses can flourish more than one approach at once and allow natural
when an entrepreneur has access to resources and talents selection to select the one that best fits the environment
that they can develop and use in a sustainable way. (Akinrinade, 1999).
According to Penrose (1959), businesses can only
succeed and gain a sustained competitive edge if they Within the emerging ideas of strategic management
have the right resources and skills that can be used in a typology, this approach encompassed the survival-based
long-term, sustainable manner. theory. Applying this idea to the topic of business
turnaround was also rather easy. A failing corporation
According to the theory, small business owners succeed typically deals with multiple issues at once, including
greatly when they have a thorough understanding of the cash flow issues, failed products, losing important
potential of their resources. Through good judgement, employees, and many more. Actually, they were only
intuition, and creative thinking, an entrepreneur selects a signs of organisational inefficiency. A company that has
specific industry where resources that are valuable, to be turned around usually has a huge human resources
uncommon, difficult to replicate, and non-replaceable department, poor sales, and limited manufacturing
will not only help the entrepreneur succeed over the long production capability. These inefficient organisational
run, but will also provide them with a competitive characteristics might assist to explain why companies
advantage and financial success. Success for that are making a turnaround usually reposition their
entrepreneurs lacking a lasting competitive advantage is products, lay off people, and sell off underutilised assets
fleeting, since rivals swiftly erase the favourable result of to strengthen their position.
their original endeavour (Udu, et al., 2008).
Improving the business's operational efficiency is a
The Survival-Based Theory turnaround business's main goal with the ultimate goal of
The "survival of the fittest" notion, sometimes referred to increasing profitability, improving environmental
as the survival-based hypothesis, was ascribed to Herbert adaptation, and ultimately making it through the fiercely
Spencer (Fabayo, 2009). Therefore, it should come as no competitive environment in which it thrives. The

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survival principle states that an organism cannot thrive if The effect of bank loan facilities on the performance of
it is unable to adapt to and become productive in its ever- SMEs in Nigeria between 2004 and 2020 was
changing environment. Therefore, the business that has investigated by Ighoroje and Akpokerere (2022). The
truly made a turnaround is the one that runs effectively research hypotheses were tested in the study using the
and adapts to its environments. Robust Regression estimation. The model's excellent
predictive power was demonstrated by the investigation.
Business Growth Theory The outcome shows that bank credit facilities had a
In the 1870s, Mitsubishi presented the corporate growth significant impact on SMEs' performance. As a result,
theory. Strong beliefs that guide company growth and bank credit extension greatly enhances the performance
the rate at which companies may profitably grow into of SMEs.
larger enterprises were introduced by the concept.
According to Penrose, a firm is made up of a variety of Musabayana et al. conducted a study in 2022 to assess
internal and external resources that aid in its expansion how government policies affected Zimbabwean SMEs'
and acquisition of a competitive edge. She goes on to profitability. The sequential exploratory technique was
claim that business growth is governed by the firm's applied in the investigation's mixed research
imaginative and effective management resources, methodology. The results of this research suggest that
however firm size has no influence on the process. She the government provided education for the top group.
continued by saying that the availability of technical Government officials, who are knowledgeable with SME
talent and top management is what drives a company's policies, briefed all SME sector specialists about the
growth. According to Penrose, failure and a loss of government's goals. However, the information was not
competitive advantage result from ignorance of these sent to the SME implementers.
issues. The concept of business growth holds that a
company's rate of growth is unaffected by its starting In Anambra State, Obananya (2022) investigated how
size. It is assumed that large firms are better for the government policies affected the growth of SMEs
expansion of the private sector since they employ more companies. A questionnaire served as the main
people than small enterprises. instrument for gathering data for the study. Regression
analysis was used in the study to analyse the hypotheses
The idea of firm growth serves as the basis for this study. that were created. The results of the study show that
This is because tiny firms perform better over time as government policies pertaining to licensing, taxation,
they learn more about the sector. This implies that a and loan distribution greatly facilitate the growth of
small firm must start and go through several stages of small and medium-sized enterprises in Anambra State's
growth. Resource development, takeoff, continuance, Onitsha North local government zone.
survival, and success are the accepted phases of growth.
At every step of its development, a number of factors In Lagos State, Nigeria, Ebube (2022) studied the
seriously jeopardise the business's survival and connection between entrepreneurial abilities, government
sustainability. regulations, and the prosperity of micro, small, and
medium-sized businesses. Both descriptive and
Empirical Review inferential analysis were used in this investigation. The
Salami et al.'s (2023) evaluated how government policies investigation's quantitative data collection approach was
affected the expansion of small enterprises and the abductive research technique. The study found that
entrepreneurship in Asaba, Delta State, Nigeria. With the the entrepreneurial abilities of managers and owners of
help of a well-designed questionnaire, the primary data micro, mid, and medium-sized enterprises were
approach was implemented. In the intervening period, significantly impacted by training programs financed by
Pearson's product-moment correlation coefficient was the Lagos State Employment Trust Fund. Additionally,
used to examine the field data. The study's findings the Lagos State Employment Trust Fund's incentive
showed a robust and statistically significant positive supports—which include interest-free loans, free
correlation between monetary policy and entrepreneurial workspace, free mentorship, and free equipment—have a
policy intervention and growth and development. direct impact on the grantees' businesses' performance.
Therefore, the institutional framework that supports
entrepreneurial decision-making is created by The study conducted by Ajike et al. (2021) aimed to
government policy. implement lean concepts in Nigerian small enterprises,
with a particular focus on small printing presses located
in the state of Enugu. The research study employed a

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survey design.. The method of census sampling was Stefan et al. (2020) used multiple log-log linear
applied. By employing Pearson's Moment Correlation regressions to study how, between 2009 and 2017,
Coefficient, the hypotheses were examined. The investments and innovation drove small and medium-
outcome of the study showed that the performance and sized firms (SMEs) to become the engine of economic
expansion of small enterprises in Enugu State are development. The quantitative findings lend credence to
significantly impacted by the implementation of lean the hypothesis that investments increase turnover. It was
concepts. found that the influence of firm size on turnover was
positive for all functioning micro-units and enterprises at
The performance of a selected group of SMEs in the national level. Furthermore, the estimation findings
Southeast Nigeria was investigated by NuelOkoli, et al. show that the number of micro-units that are actively
(2021) in relation to their entrepreneurial approach. The operating has a positive impact on the expansion of the
theories were analysed using a straightforward territorial economy.
regression analysis. According to the study, proactivity,
inventiveness, and taking risks considerably enhance Sanni et al. (2020) looked at how well 198 managers and
SMEs' success in Southeast Nigeria. owners of SMEs in Kwara State, Nigeria, performed in
terms of deposit money bank credit availability. The
The performance and economic growth nexus of small partial least squares-structural equation model and
and medium-sized firms in Nigeria was empirically descriptive statistics were both used. According to the
researched by Tahir et al. (2021) using ARDL - Bound study, bank loan availability and credit-related fees
Testing Evidence from 1980 to 2017. Findings showed (interest) were directly and strongly correlated with the
both positive and negative connections between the health of small businesses.
variables, but they also showed cointegration, which
satisfied the necessary condition for estimating the long- Ameh et al. (2020) assessed the contribution of small
term link between the variables. and medium-sized enterprises to the expansion of the
Nigerian economy, demonstrating how SMEs generate
Babandi and Barjoyal (2021) evaluated the ways in employment opportunities and support a country's
which the SMEDAN program mediated the relationship economic growth, as well as how the government can
between the growth of SMEs and key success factors effectively influence the expansion of SMES in the study
(CSFs). For the study, a mixed research technique was area. The research's conclusions show that SMEs
used. The qualitative method was employed in the continue to play a crucial role in Nigeria's progress.
investigation. The CSFs model was used to design the
study's questionnaire. The ordinal regression strategy Gap in the Review of Related Literature
was used to evaluate the variables in the statistical The past literature study revealed that the empirical
application SPSS. As per the results of the pilot study, research analysed by various authors lacked a
SMEs may have greater success if the SMEDAN comprehensive explanation about the effect of
initiative steps in to better provide them with enough government policies on the survival of small companies
financial resources and encourages them to utilise in Nigeria with particular emphasis Enugu State's
technology. The statistically significant analysis metropolis. Not much study has been done to ascertain
indicates that there is a link between the variables that the degree to which government policies affect small
are not dependent. enterprises' ability to survive in Enugu City focused on
Frozen Fish businesses via Up Town Frozen Fish &
The COVID-19 pandemic's effects on SMEs in Abuja, Meat Shop, Lizzy Fish Shop, Conyfrost Coldroom, Titus
Nigeria's Federal Capital Territory, were investigated by Fish Frozen 2, Fresh & Frozen Seafoods and Poultry.
Enesi and Ibrahim (2021). A structured questionnaire This demonstrates a gap in the literature, which supports
was given to 10 SMEs in the Abuja Municipal Area the way this study was carried out.
Council that were chosen at random and one hundred
responses were obtained as part of the research's METHODOLOGY
quantitative research methodology. The findings Research Design
demonstrated that problems such not having enough cash Descriptive research design was used. In order for the
for rent, loans, or wage payback are common among researcher to examine the causal link between the
SMEs. variables that have been identified, the design is focused
on collecting and evaluating data from the study
population.

9|Page
Sources of Data using the Statistical Package for the Social Sciences
The principal source data were mainly primary data (SPSS) version 25 to evaluate how government policies,
produced by a representative sample of the owners and the independent variable, affect the dependent variable,
managers of the Small Enterprises in Enugu Metropolis small business survival. Additionally, simple linear
that were chosen. The owners and managers of the regression was used since it is the most user-friendly
frozen fish businesses that are the study's respondents approach and can lower residual squares.
were given hard copies of the self-administered
questionnaire by the researcher, who also provided
DATA PRESENTATION AND ANALYSIS
guidance on how to answer questions in an introductory
note that was attached to the questionnaire. The appendices' Table 7-16 offers a thorough analysis of
the questionnaire distribution and return rate, which is
Population closely associated with the research questions and
The study's population comprises five selected Frozen hypotheses, SWOT analysis, and implications of the
Fish businesses. The study concentrate on Up Town results. This table provides a useful summary of the
Frozen Fish & Meat Shop, Lizzy Fish Shop, Conyfrost survey's response rate, demonstrating the degree of
Coldroom, Titus Fish Frozen, and Fresh & Frozen participant involvement and giving a clear indication of
Seafoods and Poultry for convince and due time how involved the target demographic is.
constrict. However, target population was twenty eight
respondents which comprises of Admin Officers, Questionnaire Distribution and Returns Rate
accounting section, operational officers, loaders, and Table 7 presents the distribution and return rates of the
security. (see Table 6 of the appendices) questionnaires used for data collection in the study
examining the effect of government policies on the
Sample Size Determination survival of small businesses in the frozen fish sector of
The sample size for a population of 128 respondents was Enugu Metropolis. A total of 124 questionnaires were
calculated using the Taro Yamani (1964) formula. distributed to respondents across the selected frozen fish
firms in Enugu Metropolis. Of these, 120 questionnaires
n = N______
were completed and returned, representing 96% of the
1+N (e) 2 total distributed. 4 questionnaires were not returned,
accounting for 4% of the total. This high return rate of
where n = Sample size; N = Population; e = Tolerance
96% suggests a strong level of engagement from the
error limit1 = constant. The study participant has chosen
respondents, indicating that the sample used for the study
one percent (0.01) as the allowable error margin. The
is both representative and reliable for further analysis.
translation of the formula is shown below.
The low non-return rate (4%) indicates minimal response
n = 128
bias, which enhances the validity of the study's findings.
1+ 128 (0.01)2
n = 128 Analysis of Bio-Data of Respondents
1+ 128 (0.001) Table 8 shows the bio-data of respondents. According to
the respondents' gender breakdown, 41 percent of those
n = 128 who participated are female and 59 percent of
1+0.128 participants are male. This suggests that there were
n = 128 somewhat more men among the participants, but the
1.028 sample still includes a significant portion of female
respondents, allowing for a balanced gender perspective.
n = 124.51.
Accordingly, one hundred and twenty four (124) A majority of respondents hold an O’Level
respondents make up the study's sample size. WASSCE/SSCE qualification, representing 58.4% of the
sample. This is followed by 20.8% of respondents with a
Method of Data Analysis First School Leaving Certificate, and 12.5% with an
For the study, both the descriptive and inferential phases OND or equivalent. A smaller portion, 8.3%, has an
of analysis were used. Utilising a variety of descriptive HND/B.Sc qualification, reflecting a lower
items, percentage denotations, and frequencies, the representation of higher education levels within the
descriptive analysis examined the surveys. Inferential sampled group.
assessment, on the other hand, uses regression analysis

10 | P a g e
58.3% of those surveyed, the biggest group, had one to that while many respondents believe government
five years of work experience. Next in line are 16.7% of regulations have eased access to credit, a 12.5%
responders with more than 11 years of experience and disagreed or strongly disagreed. This reveals that a
25% with 6–10 years. Given that the vast majority of portion of small businesses might still struggle with
those surveyed appear to be somewhat new to their accessing finance despite favorable regulations.
positions in the frozen fish industry, this distribution may
provide an understanding of the difficulties encountered Overall, the responses indicate a positive perception of
by companies at various phases of their operations. government credit policies, with most respondents
believing that such policies promote the survival of small
Analysis on government credit policy on the survival businesses in the frozen fish sector. However, there is
of small businesses some level of skepticism, especially regarding the actual
Table 9 presents respondents' views on the role of ease of accessing finance and the practical
government credit policies in the survival of small implementation of credit regulations. These findings
businesses, specifically in the context of the frozen fish suggest that while government credit laws are perceived
sector. positively, their effectiveness could be improved to
better support small businesses.
On "Government credit regulations help small firms stay
in business" 54.2% of respondents strongly agreed, and Analysis on government tax policy on the survival of
33.3% agreed, indicating that a significant majority small businesses
believe government credit laws positively affect the Table 10 presents respondents' views on the role of
survival of small businesses. Only 8.3% were undecided, government tax policies in the survival of small
and 4.2% disagreed, suggesting minimal opposition to businesses. The data addresses five key statements
the statement. related to tax regulations and their impact on small
businesses in the frozen fish sector of Enugu Metropolis.
On "Government credit laws help in encouraging the
survival of small businesses" Similar to the first "Government tax laws have improved small business
statement, 50% strongly agreed, and 29.2% agreed, survival and empowerment" A majority of 58.3% of
reinforcing the idea that government credit laws respondents strongly agreed, and 25% agreed, suggesting
encourage small business survival. The responses that most small business owners perceive government
suggest a general consensus on the positive role of tax regulations as significantly contributing to their
government credit policies. survival and empowerment. Only 4.2% disagreed and
4.2% strongly disagreed, indicating that while the
On "Government credit laws contribute to the survival of majority sees a positive impact, a small portion of
small businesses" 45.8% strongly agreed, and 25% businesses may not fully benefit from these regulations.
agreed. While a majority still viewed government credit
laws as beneficial, a notable 16.7% disagreed, indicating "Government tax laws encourage small enterprises to
that some respondents may perceive a gap between expand and thrive" 41.7% of respondents strongly
policy and practical outcomes. This discrepancy suggests agreed, and 37.5% agreed, indicating that government
the potential need for improving the implementation of tax policies are generally viewed as promoting both
credit policies. growth and survival of small businesses. However, 8.3%
disagreed, and 4.2% strongly disagreed, revealing some
On "Government credit regulations increased the skepticism about the effectiveness of these policies in
survival of small businesses" 54.2% strongly agreed, and fostering growth.
25% agreed, indicating strong support for the
effectiveness of government credit regulations in "Government tax laws support the survival of small
increasing business survival rates. A minor 4.2% businesses" 37.5% strongly agreed, and 33.3% agreed,
strongly disagreed, pointing to a small proportion of suggesting that a substantial proportion of respondents
respondents who may feel that the regulations are believe tax laws support the survival of their businesses.
ineffective. However, 16.7% disagreed, and 8.3% strongly disagreed,
highlighting some concern among respondents about the
On "Government regulations regarding credit have made negative impact of tax policies on their businesses.
it easier for small enterprises to get finance and loans"
41.7% strongly agreed, and 29.2% agreed, suggesting

11 | P a g e
"Government tax laws create confusion for business strongly disagreed, showing that some respondents
setting and survival of small businesses" 50% of experience challenges despite regulatory support.
respondents strongly agreed, and 29.2% agreed, "Government licensing regulations lower operating costs
suggesting that a significant portion of respondents find for small businesses to ensure their existence. " 45.8%
government tax laws to be confusing and potentially strongly agreed, and 25% agreed, suggesting that some
detrimental to business operations and survival. 8.3% businesses find licensing laws helpful in lowering
disagreed, and 4.2% strongly disagreed, which suggests operational costs. However, 16.7% disagreed, and 8.3%
that while many respondents find tax laws challenging, strongly disagreed, indicating that a notable percentage
there is a portion of businesses that are not significantly believe licensing laws increase costs rather than reduce
affected by these complications. them.

"Government tax regulations increased the survival of "Government licensing laws create rigid competition for
small businesses" 45.8% of respondents strongly agreed, small business survival" 54.2% strongly agreed, and
and 33.3% agreed, indicating that a majority of 25% agreed, showing that many small business owners
respondents believe tax regulations have positively see licensing policies as intensifying market competition.
influenced the survival of small businesses. However, 8.3% disagreed, and 4.2% strongly disagreed, suggesting
16.7% disagreed, with 4.2% of respondents remaining that some businesses do not see increased competition as
undecided, suggesting a mixed perception regarding the a direct consequence of licensing laws.
effectiveness of tax policies in supporting business
sustainability. "Government licensing policies guarantee benefit
realization for small businesses to thrive" 45% strongly
With the majority of participants recognising its agreed, and 39.2% agreed, indicating that most
beneficial effects, the replies indicate that government respondents believe government licensing policies help
tax policies are crucial to the survival and expansion of businesses succeed. 7.5% disagreed, and 3.3% strongly
small companies in Enugu Metropolis. A notable portion disagreed, revealing that a small proportion does not
of respondents expressed concerns about confusion share this positive perspective.
caused by tax regulations, which might create challenges
for small business operations. These mixed responses The responses indicate mixed perceptions regarding
indicate that while tax policies are generally seen as government licensing policies. While a substantial
supportive, there may be a need for further clarification portion of respondents view licensing laws as beneficial
and simplification to improve their effectiveness and for business survival, many also perceive them as
reduce confusion for small business owners. restrictive, creating rigid competition and discouraging
business growth. The findings suggest that while
Analysis on government licensing policy on the licensing policies may have advantages such as fostering
survival of small businesses competition and ensuring benefit realization, they may
Table 11 presents respondents' perceptions of how also create financial burdens and regulatory complexities
government licensing policies influence the survival of for small business owners.
small businesses.
Testing of Hypothesis one
"Government licensing regulations dishearten the Ho1: Government credit policy has no significant
survival of small businesses" 50% of respondents positive effect on the survival of small
strongly agreed, and 33.3% agreed, indicating that a businesses in Enugu Metropolis
significant majority believe licensing regulations
discourage small business growth. Only 4.2% strongly Analysis of Regression Results (Table 12)
disagreed and 4.2% disagreed, suggesting a minority see Government credit policy and small business survival are
these regulations as neutral or beneficial. strongly positively correlated, as indicated by the
correlation coefficient (R) of 0.885. According to the R-
"Government licensing regulations create a business- Square value of 0.783, government credit policy
friendly environment for the survival of small accounts for 78.3% of the variances in small business
businesses" 41.7% strongly agreed, and 37.5% agreed, survival. The remaining 21.7% might be caused by
demonstrating that a majority of respondents believe additional variables not taken into account by this model.
licensing policies can foster a positive business The corrected R-Square value of 0.710, which accounts
environment. However, 8.3% disagreed, while 4.2% for the number of variables in the model, reveals that

12 | P a g e
government credit policy still accounts for about 71% of Considering the p-value is more than 0.05, we cannot
the variance in business survival after accounting for rule out the null hypothesis at the five percent confidence
likely errors. level. This implies that, at the traditional 5% significance
Given the F-statistic of 10.798 and p-value of 0.046, the threshold, there is no compelling evidence that
regression equation is extremely important at the five government tax policy has a favourable impact on small
percent threshold of importance (p < 0.05). This implies business survival. Given that it is within the permissible
that the survival of small firms is greatly impacted by range of 1.5 to 2.5, the model is appropriate for research
government lending policies. The Durbin-Watson score since the Durbin-Watson score of 1.598 shows that the
of 1.455, which falls within the allowed range of 1.5 to residuals do not exhibit any discernible autocorrelation.
2.5, shows that there is no severe autocorrelation issue in
the model. Considering the p-value (0.046) is less than Considering the p-value (0.066) is higher than 0.05, the
0.05, we reject the null hypothesis (Ho₁) and accept the null hypothesis (Ho₂) cannot be ruled out.This indicates
alternative hypothesis (H₁). In Enugu Metropolis, that, at the 5% significance level, there is not enough
government credit strategy significantly improves small data to conclude that government tax policy significantly
company survival. improves small company survival in Enugu Metropolis.
Based on the data utilised in this study, the findings
The strong positive relationship between government imply that government tax policies could not
credit policy and small business survival suggests that significantly affect small company survival, at least in
access to government-backed credit programs can Enugu Metropolis. While the model shows a strong
enhance business sustainability. Policies that improve correlation between tax policy and business survival, the
access to credit, reduce loan repayment burdens, and marginal statistical significance implies that other
provide favorable lending conditions may significantly factors, such as regulatory complexity, tax burden, or
contribute to the growth and survival of small enterprises access to tax incentives, may need to be explored further
in Enugu Metropolis. to understand their effect on small businesses.

Testing of Hypothesis two Testing of Hypothesis three

Ho2: Government tax policy has no significant Ho3: Government licensing policy has no significant
positive effect on the survival of small positive effect on the survival of small
businesses in Enugu Metropolis. businesses in Enugu Metropolis.

Analysis of Regression Results (Table 13) Analysis of Regression Results (Table 14)
The correlation coefficient (R) of 0.853 shows a Government licensing policies and small business
substantial positive relationship between government tax survival have a moderate to strong positive link,
policy and small business survival. This implies that according to the correlation coefficient (R) of 0.782. It
there is a modest relationship between shifts in implies that licensing laws are important to small firms'
government tax laws and variations in small business ability to survive. Government licensing policies account
survival rates. Government tax policy explains 72.7% of for 61.2% of the variation in small business survival,
the variance in small business longevity, according to an according to the R-Square value of 0.612. This is a fairly
R-Square value of 0.727. This demonstrates the strong explanatory power, though it leaves 38.8% of the
comparatively strong explanatory power of government variation unexplained, which could be due to other
tax policy in forecasting small business survival. The factors influencing small business survival. The adjusted
adjusted R-Square value of 0.636 shows that, after R-Square value of 0.483 accounts for the number of
accounting for the number of predictors, 63.6% of the predictors, showing that 48.3% of the variation in small
variance in small business survival is explained by business survival is explained by government licensing
government tax policy. The adjusted R-square value is policy after adjusting for any potential overfitting. This
lower than the R-square, which is expected since it is still a notable proportion, but not as high as the R-
accounts for the potential overfitting with multiple Square value.
predictors.
The regression model is considered significant according
The model as a whole is considered significant according to the F-statistic of 4.734, but only at the marginal 10%
to the F-statistic of 8.000, but at the 10 percent level (p < 0.10), as indicated by the p-value of 0.118. At
significance level (p < 0.10), the p-value of 0.066 the 5% significance level, we are unable to reject the null
suggests that its significance is only minimal. hypothesis since the p-value is higher than 0.05. As a

13 | P a g e
 result, there is insufficient data to conclude that Recommendations
government licensing policies significantly increase i. The government ought to review the several policies
small business survival at the 5% level. With a Durbin- it has put in place to mitigate the detrimental impact
Watson statistic of 1.736 falling between 1.5 to 2.5, the of lending policy on small-scale business survival.
model's assumptions are met and there is no discernible ii. The government should create a tax payment system
autocorrelation in the residuals. that is convenient for small businesses and enhances
proficiency in tax compilation and payment.
Given that the p-value (0.118) above 0.05, the null iii. To encourage the growth and survival of small
hypothesis (Ho₃) cannot be ruled out. This indicates that, businesses in the city of Enugu and Nigeria as a
at the 5% significance level, there is not enough data to whole, the government must simplify the licensing
draw the conclusion that government licensing policies process and lower the license requirements.
significantly improve small company survival in Enugu
Metropolis. The marginal statistical significance
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APPENDICES
Table 6: Population Distribution
Position No of Respondents
Up Town Lizzy Fish Conyfrost Titus Fish Fresh & Frozen Total
Frozen Fish & Shop Coldroom Frozen Seafoods and
Meat Shop Poultry
Admin. Officer 3 3 4 4 5 19
Accounting section 5 4 4 4 4 21
Operational staff 7 6 10 10 11 44
loaders 6 4 8 4 9 31
Security/drivers. 2 3 3 2 3 13
Total 23 20 29 24 32 128
Source: Field Survey, 2025

Table 7: Questionnaire Distribution and Returns Rate

S/NO. Distributed Questionnaires Returned questionnaires Percentage %
1 Completed and returned 120 96
2 Not returned 4 4
TOTAL - 124 100
Source: Field Survey, 2025

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Table 8: Bio-Data of Respondents
S/No. Demographic Factor Response Option Number of Percentage
Responses (%)
1 Gender Female 49 41
Male 71 59
2 Educational First School Leaving 25 20.8
Background/Qualification Certificate
O’Level WASSCE/SSCE 70 58.4
OND or Equivalent 15 12.5
HND/B.Sc 10 8.3
3 Years of Job Experience 1-5 Years 70 58.3
6-10 Years 30 25.0
11+ Years 20 16.7
Source: Field Survey, 2025

Table 9: Responses on government credit policy on the survival of small businesses

S/N Statement No. of Respondents/ Percentage (%)
SA A U D SD Total
1 Government credit laws promote the 65 40 10 5 - 120
survival of small businesses (54.2%) (33.3%) (8.3%) (4.2%)
2 Government credit regulations support 60 35 10 10 5 120
small business survival. (50%) (29.2%) (8.3%) (8.3%) (4.2%)
3 Government credit laws contribute to the 55 30 5 20 10 120
survival of small businesses (45.8%) (25%) (4.2%) (16.7%) (8.3%)
4 Government credit regulations increased 65 30 10 10 5 120
the survival of small businesses (54.2%) (25%) (8.3%) (8.3%) (4.2%)
5 Government regulations regarding credit 50 35 10 15 10 120
have made it easier for small enterprises to (41.7%) (29.2%) (8.3%) (12.5%) (8.3%)
get finance and loans.
Source: Field Survey, 2025

Table 10: response on government tax policy on the survival of small businesses
S/N Statement No. of Respondents/ Percentage (%)
SA A U D SD Total
6 Government tax laws have improved 70 30 10 5 5 120
small business survival and (58.3%) (25%) (8.3%) (4.2%) (4.2%)
competitiveness.
7 Government tax laws encourage small 50 45 10 10 5 120
enterprises to expand and thrive. (41.7%) (37.5%) (8.3%) (8.3%) (4.2%)
8 Government tax laws support the 45 40 5 20 10 120
survival of small businesses (37.5%) (33.3%) (4.2%) (16.7%) (8.3%)
9 Government tax laws create confusion 60 35 10 10 5 120
for business setting and survival of small (50%) (29.2%) (8.3%) (8.3%) (4.2%)
businesses
10 Government tax regulations increased 55 40 5 20 - 120
the survival of small businesses (45.8%) (33.3%) (4.2%) (16.7%)

Source: Filed Survey, 2025

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Table 11: Responses on government licensing policy on the survival of small businesses
S/N Statement No. of Respondents/ Percentage (%)
SA A U D SD Total
11 Government licensing regulations 60 40 10 5 5 120
dishearten the survival of small (50%) (33.3%) (8.3%) (4.2%) (4.2%)
businesses
12 Government licensing laws foster an 50 45 10 10 5 120
environment that is conducive to small (41.7%) (37.5%) (8.3%) (8.3%) (4.2%)
company survival.
13 Government licensing regulations lower 55 30 5 20 10 120
operating costs, which helps small firms (45.8%) (25%) (4.2%) (16.7%) (8.3%)
survive.
14 Government licensing laws prerequisite 65 30 10 10 5 120
rigid competition for the survival of (54.2%) (25%) (8.3%) (8.3%) (4.2%)
small businesses
15 Government licencing policies guarantee 54 47 9 6 4 120
benefit realisation for small businesses to (45.0%) (39.2%) (8.3%) (7.5%) (3.3%)
thrive.
Source: Filed Survey, 2025

Table 12: Regression Result of Hypothesis One

Model Summaryb
Model R R Adjusted Std. Error Change Statistics Durbin-
Square R of the R Square F df1 df2 Sig. F Watson
Square Estimate Change Change Change
a
1 .885 .783 .710 2.983 .783 10.798 1 3 .046 1.455
a. Predictors: (Constant), Government credit policy
b. Dependent Variable: Survival of small businesses

Table 13: Regression Result of Hypothesis Two

Model Summaryb
Model R R Adjusted Std. Error of Change Statistics Durbin-
Square R Square the Estimate R Square F df1 df2 Sig. F Watson
Change Change Change
1 .853a .727 .636 3.578 .727 8.000 1 3 .066 1.598
a. Predictors: (Constant), Government tax policy
b. Dependent Variable: survival of small businesses

Table 14: Regression Result of Hypothesis Three

Model Summaryb
Model R R Square Adjusted R Std. Error Change Statistics Durbin-
Square of the R F df1 df2 Sig. F Watson
Estimate Square Change Change
Change
1 .782a .612 .483 15.261 .612 4.734 1 3 .118 1.736
a. Predictors: (Constant), Government licensing policy
b. Dependent Variable: Survival of small businesses

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Table 15: SWOT Analysis
Strengths (Internal) Weaknesses (Internal)
1. Strong relationship between government credit 1. High standard error in predictions: The standard
policy and business survival: A significant positive error of estimate is relatively high for some policies,
impact of credit policies, as indicated by the meaning the predictions are not very precise.
regression results (R = 0.885).
2. Government credit policy provides access to 2. High reliance on government policy: Small
loans and finance: 41.7% of respondents agree that businesses may become too reliant on government
government credit regulations made it easier for small regulations, making them vulnerable to policy
businesses to get finance. changes.
3. Moderate explanatory power of licensing and 3. Limited impact of tax and licensing policies:
credit policies: Licensing and credit policies explain Both government tax and licensing policies were
a large portion of business survival (R² = 0.783 for found to have marginal impacts on business survival.
credit, R² = 0.612 for licensing).
4. Government tax regulations provide significant 4. Possible confusion due to complex licensing
benefits: 58.3% agree that tax policies have added laws: Some businesses find licensing regulations
value to small business survival. confusing, which may hinder survival.
Opportunities (External) Threats (External)
1. Reform government policies for improved 1. Changing government policies: The risk of policy
business conditions: There’s potential to push for shifts can negatively affect the business environment,
more supportive credit, tax, and licensing regulations particularly when government regulations become
to increase small business survival. more stringent.
2. Increasing support from government on credit: 2. Competition and market saturation: Licensing
With strong positive feedback on government credit policies may encourage competition, but the small
policies, there's an opportunity for more businesses to business sector may struggle to remain competitive if
benefit from such policies. not properly supported.
3. Encouraging collaboration with government 3. High tax rates: Although tax policies are meant to
agencies: Small businesses can collaborate with support businesses, high taxes can act as a burden,
government bodies to influence the improvement of reducing profitability and threatening the survival of
policies affecting survival. small enterprises.
4. Simplifying licensing processes: There’s an 4. Regulatory complexities and costs: Rigid
opportunity for government to ease licensing licensing laws and high compliance costs could
requirements, making it easier for new businesses to hinder new and existing small businesses from
enter the market and survive. thriving.
Source: Author’s adoption, 2025

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Table 16: Implications of the Findings to Relevant Stakeholders
Stakeholder Implications of the Findings
Small Business Owners 1. Increased access to credit: Small business owners should leverage the
government’s credit policies to secure loans and finance to grow their
businesses.
2. Monitor tax and licensing changes: They need to stay informed about
government tax and licensing policies to avoid confusion and take
advantage of favorable regulations.
3. Advocacy for policy reform: Owners can collaborate with government
agencies to push for clearer, more supportive tax and licensing frameworks
to ensure business survival.
Government Agencies (e.g., 1. Policy refinement: The positive relationship between government credit
Central Bank, Tax Authorities, policies and business survival calls for the continued support and
Regulatory Bodies) refinement of credit regulations.
2. Improvement in tax policy: The findings suggest that tax regulations
should be fine-tuned to ensure they are not burdensome to small businesses
while still providing necessary support.
3. Simplifying licensing processes: The complexity of licensing
regulations can hinder small businesses. Regulatory bodies should consider
simplifying and streamlining processes to support new and existing
businesses.
Financial Institutions 1. Increased demand for credit products: With positive feedback on
government credit policies, financial institutions ought to customise their
offerings to better suit small company demands..
2. Collaboration with government: Financial institutions can work with
government agencies to offer better credit facilities, ensuring that they are
accessible to small businesses.
Local Government 1. Enhancing local business policies: Local government can strengthen its
role in supporting small businesses by aligning policies with those of the
federal government, particularly in terms of credit, tax, and licensing.
2. Fostering local economic development: Supporting small businesses
through favorable government policies can aid in the establishment of jobs
and economic expansion locally.
Academics/Researchers 1. Further research on policy impacts: The findings present opportunities
for further research on how government policies can be optimized for small
business growth, which could inform future studies and publications.
2. Policy analysis and recommendations: Academics can use the data to
assess policy impacts more broadly, making recommendations for
improved practices in credit, tax, and licensing policies.
Business Associations (e.g., 1. Advocating for favorable policies: Business associations can use the
NACCIMA, NASSI) findings to advocate for better policies at the national and local levels to
support small businesses, particularly in the credit and taxation areas.
2. Training and support programs: Based on the findings, associations
can organize training sessions and workshops to educate small business
owners about navigating government regulations.
Consumers/Local Community 1. Better access to goods and services: By fostering the survival of small
businesses through supportive government policies, consumers can benefit
from improved access to diverse products and services.
2. Community development: As small businesses thrive, there’s likely to
be an increase in local employment and community development,
contributing to a more robust local economy.
Source: Author’s adoption, 2025

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