Impact of Economic Policies on the Performance of Small and Medium-Scale Enterprises in Ugep, Cross River State, Nigeria
Keywords:
Economic policy, Interest rate, Small and medium enterprises, Infrastructural development, Nigeria.Abstract
This study examines how key macroeconomic policy frameworks—specifically interest rate policy, infrastructure development, and performance-based incentives—affect the operations and growth of small and medium-sized enterprises (SMEs) in Ugep, Cross River State, Nigeria. SMEs constitute approximately 96.9% of registered businesses in Nigeria, contributing nearly 48% of GDP and employing about 87.9% of the national workforce. Despite this strategic significance, many SMEs experience poor performance, limited growth, and premature failure. Using a descriptive survey research design, primary data were gathered from 72 small and medium-scale business operators selected from a target population of 100 registered enterprises through simple random sampling. The research instrument demonstrated high reliability (Cronbach's Alpha = 0.84). Data were analyzed using descriptive statistics and Chi-square tests. The findings reveal that interest rate policy significantly affects SME performance (χ² = 15.31, df = 4, p < 0.05), infrastructure development policies significantly influence operational outcomes (χ² = 25.01, df = 4, p < 0.05), and performance incentives significantly impact business outcomes (χ² = 24.87, df = 4, p < 0.05). The study concludes that government economic policies serve as a primary structural driver for the expansion, performance, and long-term survival of small enterprises. Practical recommendations include establishing concessionary interest frameworks, targeted infrastructural funding for semi-urban areas, and designing accessible incentive schemes tailored to SME capacities.
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