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THE EXTENT OF THE USAGE AND ADOPTION OF INFORMATION TECHNOLOGY IN NIGERIA WITH PARTICULAR REFERENCE TO THE FINANCIAL SECTOR OF THE ECONOMY: SOME PERCEIVED BENEFITS AND PROBLEMS BY ANTHONY ADELOYE A THESIS SUBMITTED TO THE SCHOOL OF LIBRARY, ARCHIVE AND INFORMATION STUDIES, UNIVERSITY COLLEGE LONDON, IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF PHILOSOPHY. MARCH, 1999 ProQuest Number: 10630761 All rights reserved INFORMATION TO ALL USERS The quality of this reproduction is dependent upon the quality of the copy submitted. In the unlikely event that the author did not send a com plete manuscript and there are missing pages, these will be noted. Also, if material had to be removed, a note will indicate the deletion. uest ProQuest 10630761 Published by ProQuest LLC(2017). Copyright of the Dissertation is held by the Author. All rights reserved. This work is protected against unauthorized copying under Title 17, United States C ode Microform Edition © ProQuest LLC. ProQuest LLC. 789 East Eisenhower Parkway P.O. Box 1346 Ann Arbor, Ml 48106- 1346 ABSTRACT Nigeria on the whole, like the majority of countries in Africa, may still be less computerised than the fast developing countries of Asia, but the use of IT in Nigeria is increasing rapidly albeit haphazardly, particularly in the private sector of the Nigerian economy. In the public sector the use of IT is often taken for granted. The chief aim of the research is to identify the extent to which IT, particularly computer networks such as Local Area Networks (LANs) and Wide Area Networks (WANs) have actually penetrated both the private and public sectors of the Nigerian economy and to analyse some of the problems encountered in acquiring IT which from the point of view of Nigeria and many developing countries is an imported technology. The research also looks at how IT is currently used in Nigeria and attitudes concerning IT. A postal questionnaire and recorded interviewing sessions were used to carry out the study. The overall results of the study showed that the use of and awareness of IT in Nigeria are rather mixed. On the whole, the private sector appears to be more aware of the benefits of IT. There is however, a general awareness of IT in both sectors of the need to use computer networks. The absence of an effective strategy among government institutions allied with lack of funds, and of skilled personnel and a poor infrastructure, for example poor telephone services and a lack of regular electricity supply appear to contribute to the lack of general awareness of the importance of IT in the public sector. In conclusion, the study notes that Nigeria is faced with the possibility of falling behind the rest of its major competitors if it fails to make efforts to upgrade the status of IT in both the private and public sectors. Some remedial measures, such as the industrial policy interventions adopted by the government of Singapore and other East Asian countries in co-operation with private firms are recommended that might help not only Nigeria to correct the situation but also other developing countries. The role of the government in influencing the nature and organisations which provide the information infrastructure is emphasised. II TABLE OF CONTENTS Page Abstract II Table of Contents III List of Figures/List of Tables VIII-IX Acknowledgements/Declaration XI-XII List of Abbreviations XIII List of Definitions XIV CHAPTERS 1 . DEFINITIONS AND COVERAGE 1 1.1 Background 1 1.2 Aim of Study and its Significance 4 1.3 Definitions 8 1.4 Structure of Study and Summary of the Major Findings 16 2 NIGERIA - THE COUNTRY AND ITS ECONOMY 22 2.1 Introduction 22 2.2 Population and Labour Force 25 2.3 The Nigerian Economy 3 0 2.4 Infrastructure and Level of Education in Nigeria 35 i. Transportation 35 ii. Energy Provision 39 iii. Communications - Nigeria Telecommunications (NITEL) 41 III iv. Education and Health 42 2.5 Privatisation and Communication 43 2.6 Banking, Financial Services and Capital Markets 43 2.7 Industry 47 2.8 Other Services 51 2.9 Summary and Conclusion 51 3 ASSESSMENT OF TELECOMMUNICATIONS PROVISIONS53 3.1 Introduction 53 3.1.1 Telecommunications in Nigeria 53 3.1.2 External Telecommunication 59 3.1.3 The Establishment of Nigeria Telecommunications 63 3.1.4 Finding Solution to Telecommunications Problems 64 3.1.5 Summary and Conclusion 70 4 LEVEL OF NETWORKING TECHNOLOGIES 72 4.1 Introduction 72 4.1.1 The Use of Networks 72 4.1.2 The Benefits of Distributed Database 73 4.1.3 The Internet 74 4.2 The Government Policy and Level of Computerisation 75 4.2.1 The Business Organisations 76 4.2.2 Previous Studies 76 IV 4.2.3 The Role of the Central Bank of Nigeria 77 4.2.4 To Invest or not to Invest 78 4.3 Summary and Conclusion 79 5 INVESTMENT IN INFORMATION TECHNOLOGY 80 5.1 Introduction 80 5.2 The Work of Kraemer and Dedrick 81 5.3 Environmental Factors and Investment in IT 82 5.4 Lessons for Developing Countries 90 5.5 Summary and Conclusion 97 6 SINGAPORE’S IT POLICY AS A MODEL FOR DEVELOPING COUNTRIES 99 6.1 Introduction 99 6.2 Information and the Development Process 102 6.3 Policies to Promote IT in Singapore 106 6.3(i) Policies Adopted to Promote IT in Singapore 6.3.1 IT User Training 108 6.3.2 Software Production 108 6.3.3 IT Use in the Private Sector 109 6.4 IT 2000 - Creating the Intelligent Island 110 6.5 Summary and Conclusion 112 V 7 THE SURVEY AND THE METHODS OF DATA COLLECTION 7.1 Introduction 113 7.2 The Methods of Data Collection 113 7.3 Postal Questionnaire 116 7.3.1 Questionnaire Design 116 7.3.2 Population and Sample 120 7.3.3 Limitation of Questionnaire 122 7.4 Summary and Conclusion 123 8 RESULTS OF THE POSTAL QUESTIONNAIRE 124 8.1 Introduction 124 8.2 Results of the Questionnaire 124 8.3 Results of the Interviews 138 9 DISCUSSION OF THE MAIN FINDINGS, CONCLUSION AND RECOMMENDATIONS 151 9.1 Introduction 151 9.2 The Main Findings of the Research and their Significance 151 9.3 Conclusion 154 9.4 New Developments in IT in Africa and Nigeria 157 9.4.1 Short Distance Local Loop Technologies 159 9.4.2 Cellular Telephony (Point-to-Multipoint Systems) 159 9.4.3 Pocket Radio 161 VI 9.5 Practical Recommendations Arising from the Study 163 APPENDICES Appendix 1 Report of the Computerisation Committee - Nigeria High Commission, London 164 Appendix 2 National Policy on Science and Technology - Federal Ministry of Science and Technology, 1986 168 Appendix 3 Telecommunications Networks - Brief notes and illustrations 176 Appendix 4 List of Federal Government of Nigeria Ministries and Research Institutes under Federal Ministry of Science and Technology 185 Appendix 5 Letter accompanying questionnaire used as part of the research study 189 Appendix 6 Questionnaire - The use of IT in Nigeria 190 Appendix 7 Nigeria Telecommunications Pic - Engineer /Technical Training Centre, Oshodi. Telecommunications/Computer Training Programmes 194 REFERENCES VII LIST OF FIGURES 1.1 A simple schema of data/information 10 1.2 Main constituents of IT and their components 11 1.3 Communication Technology trends 14 1.4 Network Technology trends 14 2 Map of Nigeria 19 2.1 List of states of Nigeria 20 8.1 Major uses to which LANs are put 134 8.2 Main benefits derived from using LANs 134 8.3 Problems associated with using LANs 134 8.4 Uses of WANs 134 8.6 Training availability 135 8.7 Maj or training routes 135 VIII LIST OF TABLES 2 Official census 27 2.1 Average exchange rates 32 2.2 Foreign reserves 33 2.3 Exchange rates 35 2.4 Transport statistics 38 2.5 National energy statistics 40 2.6 Stock market turnover 46 2.7 Stock market prices indices 47 2.8 Industrial production indices 49 2.9 Manufacturing output indices 50 5.1 Countries by level of economic development 82 5.2 IT investment in Asia-Pacific countries 84 5.3 Environmental variables for 13 Asia-Pacific 95 5.4 Variables found to have statistically correlates with IT spending 96 7.1 Details of pilot study groups 119 7.2 Nigeria Standard Industrial Classification 121 8.1 Response to the Postal questionnaire 125 8.2 Availability of information units in various sectors/activities categories 127 8.3 Availability of information units in the respondents organisations 128 8.4 Possession in use of communication tools by respondents 129 8.5 Length of the period the communication tools have been used 130 8.6 The types and length of time computers were used by respondents 131 8.6A Purchasing budgets expressed as a percentage of the organisations’ overall budget 133 8.7 Comments by respondents 137 8.8 Detailed analysis of computer usage in both private and government departments 139 8.9 Total number of PCs in companies/organisations 140 8.10 Formularisation of investment decision/IT Proj ects abandoned 141 8.11 Summary of computers in the Banking and Insurance Sector 147 8.12 Range of PCs Based Application Programmes in use in Banks 147 8.13 Reported computer abuse incidents in Nigeria by type 149 X Acknowledgements For constructive advice, support and encouragement, I would like to thank most sincerely my academic supervisors, John Mcllwaine and Andy Dawson of University College London. I must also thank the authorities at the Nigerian High Commission, London for their support.