18TH CENTURY VERSUS 21ST CENTURY: BALANCING NIGERIA'S PREPAREDNESS FOR AN INDUSTRIAL REVOLUTION
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| Columnist: Daniel Chimezie Uzoigwe |
1. INTRODUCTION
1.0 WHAT IS INDUSTRIALIZATION?
In Economics, the term industrialization is usually used to connote a condition marked by an increase in the importance of industry to an economy. The process of industrialization describes the transition from an agricultural society to one based on industry. It is argue that during the process of industrialization, per capita income (level of income per person) rises and productivity levels also increase.
1.1 WHAT IS THE INDUSTRIAL REVOLUTION
The term
industrial Revolution (IR) is usually used in economic thought to describe the
widespread replacement of manual labour by machines that began in Britain in
the 18th century and is still continuing in some parts of the World.
According to Mokyr (2001), the industrial revolution is argued to have taken
place roughly from 1760 to 1830. The revolution consisted of a set of
technological, economic and economic and social changes that in the long run
revolutionized not just the British economy but the rest of Western Europe,
North America and eventually much of the rest of the World.
The most
immediate changes of the industrial revolution were in d nature of production;
what was produced, as well as where and how.
1.2 WHAT STIMULATED THE INDUSTRIAL
REVOLUTION
The
industrial revolution began in Great Britain because social, political, and
legal conditions there were particularly favourable to change. There were
particularly important improvements in transportation, such as faster ships,
and communication, especially printing which played a key role in the
development of the industrial revolution.
There were
spectacular changes in industry and as Stigler (1965) would argue, iron and
steel manufacture, the production of steam engines, and textiles were all
powerful influences on Britain’s industrialization experience.
However,
Derry and Williams (1987) argue that the industrial revolution was stimulated
by factors remote from technology including the fact that there was no civil
strife in England, the presence of a large middle class and the fact that
government favoured trade.
1.3 IMPACT OF THE INDUSTRIAL REVOLUTION
The
industrial revolution is called a revolution because it changed society both
significantly and rapidly. Over the course of history, it is arguable that the
industrial revolution is one of the most spectacular events in global history.
As economic
activities in many communities moved from agriculture to manufacturing,
production shifted from its traditional locations in the home and small
workshops to factories. Stigler (1965) argues that the overall amount of goods
and services produced expanded dramatically, and the proportion of capital
invested per worker grew.
In the long
run, the industrial revolution brought economic improvement for most people in
England with improved health and greater prosperity to people especially in the
middle and upper classes of society. Specifically, we can follow Derry and
Williams (1987) to argue that the industrial revolution:
i.
Made
industry to grow four times faster
ii.
Changed
all aspects of society including manufacturing
iii.
Transformed
social classes and
iv.
Ensured
higher standard of living for most.
2. A
SITUATION ANALYSIS
2.0 WHY INDUSTRIALIZATION IS CRITICAL TO NIGERIA’S
DEVELOPMENT
Industrialization has been known to be associated with growth
in real per capita income and overall output growth hence, the maxim that
manufacturing is the engine of growth. As a developing country, Nigeria needs
industrialization to ensure wealth creation, reduce poverty and inequality gap
including Nigeria’s back-aching unemployment level.
2.1 NIGERIA’S EXPERIENCE WITH INDUSTRIALIZATION
Since
independence in 1960, Nigeria has made several efforts at industrialization.
Even before independence, efforts were made to industrialize the Nigerian
economy but these efforts were unco-ordinated and half-hearted (Ahmed, 2005).
The Nigerian
government recognizes that industrialization is critical to national economic
development and have put up policy measures aimed at industrializing the
national economy.
2.2
NIGERIA’S INDUSTRIAL POLICY MEASURES SINCE 1960
To
facilitate Nigeria’s industrial development, the Nigerian government has made a
lot of efforts aimed at making the country an industrialized economy. Some of
these efforts at industrialization include:
I.
In
the 1967-70 period, Nigeria pursued primarily a policy of industrialization
based on import substitution.
II.
From
1974 to 1980, the industrialization strategy changed swiftly from assemblage
plants to heavy duty industrial structures.
III.
The
establishment of the Nigerian Industrial Development Bank (NIDB) and the
Nigerian Bank for Commerce and Industry (NBCI) were all aimed at promoting
Nigeria’s industrialization.
IV.
The
Central Bank of Nigeria (CBN) credit guidelines prescribed high allocation of
credit to the industrial sector.
V.
The
Structural Adjustment Programme (SAP) of 1986 was aimed at diversifying
Nigeria’s economic base including the productive sector of the economy.
VI.
In
2009, the Federal Government, through the Bank of Industry (BOI) launched the
N100 billion textile and garment industry revival fund.
VII.
The
United Nations Industrial Development Organization (UNIDO) has made efforts at
ensuring Nigeria’s industrialization.
2.2.1 NIGERIA’S INDUSTRIAL POLICY OF 1988 AND THE BANK OF
INDUSTRY
In 1988,
Nigeria launched an industrial policy aimed at achieving an accelerated pace of
industrial development for the country. The policy was principally targeted at
increased export of manufactured goods and promotion of industrial development
and national integration through industrial dispersal
In the same
vein, the Bank of Industry was established to provide loanable funds to small
and medium scale industrialists to facilitate Nigeria’s industrialization.
2.2.2 THE
NATIONAL INDUSTRIAL REVOLUTION PLAN
In 2012, the
Ministry of Trade and Investment announced a plan for the Country’s
industrialization. The plan is aimed at positioning and empowering the nation’s
manufacturing sector as the key driver of economic growth through job creation.
However, it
is very debatable how much these policies have actually imparted Nigeria’s
industrialization.
3. AN
EVALUATION
3.0 HOW MUCH
PROGRESS HAS NIGERIA MADE TOWARDS INDUSTRIALIZATION
However, it
is to be noted that the investments of oil Multi-national Corporations (MNCs)
in the petroleum industry has impacted positively on Nigeria’s
industrialization.
Aside the
industrial growth experienced in the petroleum industry, manufacturing
essentially has been on the decline. According to Iyoha (2005), for the decade
of the 1990s, industrial output contributed a relative share of 49.6% to GDP.
There is a rejoinder however and that is the fact that the high level of
industrial contribution to GDP in the 1990s was essentially because of
favourable oil prices. This is because for the same decade of the 1990s, the
relative share of manufacturing production in GDP only managed to average an
anaemic 4.96%. Nigeria’s manufacturing sector remains at the lowest ebb with
the collapse of the iron and steel industry, the textiles industry leaving only
the cement industry relatively active.
3.1
CHALLENGES TO NIGERIA’S INDUSTRIALIZATION
Despite
Nigeria’s efforts at industrialization, the country has faced many challenges
inhibiting industrialization. Ahmed (2005) identified some of these challenges
to include:
I.
High
geographical concentration
II.
High
production cost
III.
Low
value added
IV.
Low
capacity utilization
V.
High
import content of industrial output, and
VI.
Low
level of foreign investment in manufacturing.
However,
apart from these challenges, it is evident that incoherent and inconsistent
policy of government towards industrialization has impacted the industrial
sector negatively. This is just a way of saying that the government has not
mustered enough political will to set Nigeria on the path of industrialization.
In the same
vein, the power sector which is epileptic has not favoured Nigeria’s
industrialization. Corruption and inefficiency in the management and subsequent
privatization of our strategic iron and steel industry has left it in a
comatose state.
3.2 18TH
CENTURY VERSUS 21ST CENTURY: LESSONS FOR NIGERIA FROM THE ENGLISH
EXPERIENCE
Earlier on,
we established that the industrial revolution began in Great Britain because
social, political, and legal conditions were known to be particularly
favourable to change.
Nigeria has
a lot of lessons to learn from the European experience. The lesson here
primarily is that Nigeria may not be able to experience her own industrial revolution
until social, political and economic conditions become favourable to change.
A study of
the British industrial revolution shows that the industrialization process was
strategic and internally-driven. Nigeria has a lesson to learn from this as
true industrialization can only come through the development of the local
industry and not by seeking aid and grants that would be misapplied. The East
Asian miracle is also a big lesson for Nigeria on how countries can develop
their industrial capacity by looking inwards.
3.3 HOW
CERTAIN IS NIGERIA’S PREPAREDNESS FOR AN INDUSTRIAL TAKE-OFF
Nigeria’s
industrial take-off cannot be said to be certain since the government is not
strategic and co-ordinated in its efforts to industrialize. The lack of
political will to implement existing policies is also a big issue.
Moreover,
the epileptic state of the power sector remains an albatross to Nigeria’s
industrial take-off. Until, the power problem is fixed, Nigeria’s efforts at
industrialization would remain a mirage.
4.CONCLUSION
AND RECOMMENDATION
4.0 THE WAY
FORWARD FOR NIGERIA’S INDUSTRIALIZATION
For Nigeria
to experience industrialization, conscious efforts must be made in this regard.
Moreover, efforts at industrialization must be sincere and internally-driven.
In the light of the above, the following recommendations are made:
I.
Efforts
should be made to fix the power sector to reduce the high cost of production in
the manufacturing sub-sector of the industrial sector.
II.
Government
should promote the growth of small and medium scale industrial outfits as this
will help fast track Nigeria’s industrialization.
III.
Efforts
at industrialization should be internally-driven. In this regard, Nigeria
should learn from the experience of the East Asian Miracle.
IV.
Efforts
should generally be geared towards the promotion of research and development (R&D)
as this is critical to industrialization.
V.
Since
the industrial revolution (IR) in England did not come from the English
Universities but from the workshops, efforts should be made to increase
vocational and technical education for the emergence of small and medium scale
industrialists who would drive the much –needed industrial growth in Nigeria.
VI.
Political,
economic, legal and social factors must change for Nigeria’s industrialization
to be possible,
VII.
There
is need for promotion of public-private partnership (PPP) in the efforts at
industrialization.
4.1 CONCLUSION
From our
analysis above, we agree that the industrialization in England was successful
because conditions in England were prepared for change and favourable to
industrialization. In the Nigerian case however, apart from positive
developments in the foreign investors-dominated petroleum industry and good
progress in the cement industry, we find that broad socio-political conditions
necessary for industrialization are not in place thereby casting doubt on the
country’s preparedness to industrialize. As a matter of fact, the country has
experienced de-industrialization in the very strategic iron and steel industry
and the textile industry. This is the Nigerian experience at present and the
verdict is that with what is on grounds at present, Nigeria’s preparedness for
an industrial revolution is uncertain. It is however unfortunate that what
England achieved as far back as the 18th century, Nigeria is not
able to achieve in the 21st century.
7.0 References
Afolabi A.B
(2008). Repositioning the Nigerian
Economy through Scientific and Technological Innovations. Africa; Journal
of contemporary Issues.
Clark,Gregory
(2001). The Secret History of the Industrial Revolution. Department of
Economics, UCD,CA 95616.
E.U Ahmed
(2005): ‘ Development of Industry and
Manufacturing.’ In Structure, Growth and Development of the Nigerian
Economy. Mindex Publishers. Benin-City.
Iyoha, M. A
(2005). ‘An Overview of Leading Issues in
the Structure and Development of the Nigerian Economy since 1960.’ In
Structure, Growth and Development of the Nigerian Economy. Mindex Publishers.
Benin-City.
Joseph,
Onipede (2010): Technology Development in Nigeria: the Nigerian Machine Tools
Industry Experience. Department of General Studies, LAUTECH.
Porter,Glenn.
‘Industrial Revolution.’ Microsoft Encarta 2009(DVD). Redmond ,WA: Microsoft
Corporation,2008.
Stigler,Joseph(1965).
The Process and Progress of Economics. Graduate School of Business, University
of Chicago.
T.K Derry ,
T.I Williams (1987). A Short History of Technology.
