GOVERNMENT STIMULUS PACKAGES AND THE SURVIVAL RATE OF SMALL AND MEDIUM ENTERPRISES: A POST-COVID-19 STUDY IN EDO STATE

Abstract

This study examined government stimulus packages and the survival rate of Small and Medium 
Enterprises (SMEs). The specific objective of the study was to determine whether the 
implementation of government stimulus packages has a significant effect on the survival rate 
of SMEs. Stimulus packages were dimensioned into government tax reduction and interest rate 
reduction. The study adopts a quantitative research technique using a data collection method 
through the administration of a structured questionnaire. The population of the study consists 
of 2,677 registered SMEs in Edo State, according to the NBS-SMEDAN National Survey of 
MSMEs (2017). A convenient sampling technique was used to elicit responses from 150 SME 
managers in Edo South. Data was analyzed using Ordinary Least Squares (OLS) analysis, the 
pre-estimation analyses were unit root tests, and the main analysis was done using multiple 
regression analysis. Findings from the analysis indicate favourable correlation between Edo 
State's SMEs' survival rate and government stimulus packages. In addition, the study 
discovered that the SME survival rate positively correlated with lower government taxes and 
interest rates, although this association was not statistically significant. The study recommends 
that firms with stronger financial positions were more likely to withstand the economic shock 
of the pandemic. As a result, the NGOs, organisations and government should introduce a well
monitored implementation procedure for efficiency, and the post-COVID-19 stimulus 
initiatives for SMEs in Edo State should be continued.