In Nigeria, economic policy should set the
parameters in the economic system of the country, which should constitute the
key part of the economic practice thereby creating an environment affecting the
development and functioning of either collective or individual Small and Medium
Enterprises (SMEs) operators and thus logically affecting the sector(s) of the
economy. This work examines the effect of selected economic policies on the
growth of SMEs in Nigeria. Notwithstanding the attention placed on monetary,
fiscal and trade policies, in the overseeing of the economy, the SMEs sector
all encompassing, Nigerian economy particularly SMEs are up until the present
time of this study not growing as expected. The time frame was from 1986 to
2017, a thirty-two-year study. Research design employed was ex-post facto and a
population of seventy-two thousand eight hundred and thirty-eight (72,838) SMEs
in Nigeria were used. The sample size was the entire 72,838 SMEs of which the study
relied on reports from Central Bank Statistical Bulletin and SMEDAN, thereby
employing the Error Correction Mechanism (ECM) tool of analysis to analyze the
time series data. The study found that economic policy (proxies: monetary
policy, fiscal policy and trade policy) had no positive significant effect on
the growth of SMEs in Nigeria. Therefore, the study recommends that economic
policy should be design and formulated in such a way that the goals the SMEs
want to achieve through monetary, fiscal and trade policies should be realistic
and feasible in terms of growth.
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