International Journal of Social Sciences and Humanities Reviews Vol.5 No.1, February, 2015; p.52 – 66, (ISSN: 2276-8645)

THE CRISIS OF INDUSTRIALIZATION IN AFRICA: A FOCUS ON NIGERIA

DAHIDA DEEWUA PHILIP (Ph.D) DEPARTMENT OF PUBLIC ADMINISTRATION OF ABUJA, ABUJA - NIGERIA Email:[email protected] [email protected]

ABSTRACT This study intends to unravel the copious challenges which hampered industrial growth in Africa and in deed Nigeria as a nation. Nigeria for instance, after independence in 1960, the main stay of her economy was with little elements of textile and agro-allied industries until around late 1970’s, these industries came to a state of comatose. One of the reasons for the distortion in the industrial development was the production of oil in commercial quantity. By implication, the discovery of oil made most African states like Nigeria to settle for an economy which relies mainly on primary mode of production instead of developing the hitherto existing local craftsmanship into modern industries. Also most consumers in Africa prefer foreign products to locally made due to inferiority complex. In the long-run most infant industries producing locally made products folded up due to inability to favorably compete with the western . After a thorough review of relevant literature, the study adopted the dependency approach as theoretical framework that guides the paper. The main objective of the paper is to investigate in to the multiple problems that have accounted to the decline in the sector that led to industrial crisis. In an attempt to achieve the objective of this study, content analysis was used to articulate the views of notable scholars who have meaningful contributions on the subject matter. As to methodology, the paper made use of secondary data which include; pamphlets, magazines, , journals, bulletins, newspapers, government publications and services. The study revealed that, the major challenge confronting industrial growth in most African countries and Nigeria in particular is lack of political will and focused leadership to break away from mono-cultural economy i.e. oil, with out diversification to allow industrial growth and development to flourish. Other set- back include the followings; lack of access to micro facilities, epileptic power supply, weak market structure, general lack of trained manpower- technical know-how and challenges. The attendant effects are that, there is no wealth creation, lack of job opportunities and high level of unemployment. Although in principles, Nigeria is regarded as the giant of Africa but in practice she is a consumer nation without potent industrial growth and development. One major recommendation in the study is that skill acquisition and rejuvenation of technical by institutions of higher learning and technical colleges as well as diversification of the economy to entrenched in it industrial base and development is seriously advocated.

Keywords: ; ; Industrialization; ; Agriculture

Introduction Industrialization in Africa has been profoundly disappointing. The majority of countries continue to have a very poorly developed industrial base without the structural change and diversification experienced by other developing areas. The extent of Africa's industrial crisis is more far-reaching. Two questions are a source of controversy. Firstly, why has the level of industrial achievement been so low? More specifically, have the import substitution policies followed by most Africa countries failed or have they simply not been

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International Journal of Social Sciences and Humanities Reviews Vol.5 No.1, February, 2015; p.52 – 66, (ISSN: 2276-8645) implemented effectively? Secondly, which policies should be adopted in future? For their part, African governments are convinced that industrialisation strategies should form a critical part of their attempts to achieve more rapid and self-reliant development and they are therefore committed to specific policies to accelerate industrial growth. The above quotation is a true manifestation of the Nigeria situation. However, nevertheless, the main focus of this paper is on development of industries in Nigeria, causes of the decline of industrial growth in Nigeria, and the state of industries during the 70s (the oil boom period). Industrialization is a process of reducing the relative importance of extractive industries and of increasing that of secondary and the tertiary sectors (Adejugbe, 2004). There is evidence to suggest that industrialization and in particular manufacturing is the prime mover of economic development. This is given that it creates employment, enables wealth creation and facilitates alleviation. Nigeria’s experience with industrialization since independence is a classic case of misfortune. Scholars have eminently commented on Nigeria’s industrial policies especially since 1960 (Ikpeze, Soludo & Elekwa, 2004; Adejugbe, 2004; Anakom, 2008; Ugbor, 1988; Dare-Ajayi, 2007; Ishiola, 2004). However, majority of these works reveal an obvious bias for some of the policies, while others in most cases simply criticized without properly analyzing the policies. There is an intrinsic relationship between industrialization and economic development. This is given that there is hardly any country that has developed without industrializing even as rapidly growing economies tend to have rapidly growing manufacturing sectors (UNIDO, 2009). England, which is widely acclaimed as the first developed country, achieved this status using the Industrial Revolution, which enabled it, thanks to series of cost-reducing , to increase its industrial output fourfold beginning from the first half of the eighteenth century. Since then, the main criterion for development has been an increase in per capita income resulting mainly from industrialization. The case of Southeast Asia, is self evident. In these economies industrialization has proved to be the natural route to development. Their spectacular rise, contrasts sharply with the continued industrial marginalization of sub-Saharan Africa as well as other least developed economies. Take the example of Qiaotou, which about twenty years ago was only a small village in China. This same village today, produces almost two thirds of the world’s buttons (UNIDO, 2009), thanks to its rapid pace of industrialization. The potential of industrialization for growth is particularly distinctive to manufacturing. As manufacturing activity expands, instead of running up against shortages of land or resources that inevitably constrain the growth of agriculture or the extractive industries, it benefits from economies of scale in terms of unit costs of production (UNIDO, 2009). In Africa, it is also true to say that the few economies that have showed some promises are the ones in which considerable attention have been given to industrial development. Some of these countries include South Africa, Mauritius, Botswana, Egypt, Namibia and Senegal. Mauritius is in fact a suitable example. From a poor sugar-dependent nation, this country has been able to diversify its economy to the point that manufacturing has become its primary source of revenue.

STATEMENT OF THE PROBLEM A glance at the foregoing background to this paper attested to the fact that industrialisation seems to be central to economic growth and development. Therefore, successive governments in Africa and Nigeria in particular emphasise industrialisation as a way of transforming her ailing economy. For instance, Nigeria has pursued industrialisation with the hope to transform the economy from a monolithic, inefficient and import- dependent economy to a more dynamic robust and export-oriented economy, especially exports of industrial goods. These aspirations as contained in the successive development plans (especially, first and second development plans) of the Federal Government were further reinforced by the windfall gains from crude oil boom of the 1972/73 and 1979/80 periods. However, despite series of deregulation policies introduced since 1986 by successive governments to facilitate industrialisation process in an economically conducive manufacturing environment, the performance of the industrial sector remains undesirable. In the last two decades, Nigeria recorded an unremarkable economic performance especially in manufacturing industry in the areas of production and international trade. Besides, its poor macroeconomic might have largely contributed to such unfavourable performance of the industrial (manufacturing) sector. In 2003, manufacturing accounted for 4 percent of the GDP, down from 13 percent in 1982. Pre-independence Nigeria, its large population notwithstanding, had very little industrial development—a few tanneries and oil-crushing mills that processed raw materials for export. During the 1950s and 1960s a few factories, including the first textile mills

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International Journal of Social Sciences and Humanities Reviews Vol.5 No.1, February, 2015; p.52 – 66, (ISSN: 2276-8645) and food-processing plants, opened to serve Nigerians. During the 1970s and early 1980s industrial production increased rapidly, principally in Lagos, Kaduna, Kano, and Port Harcourt. Factories also appeared in smaller, peripheral cities such as Calabar, Bauchi, Katsina, Akure, and Jebba, due largely to government policies encouraging (although these policies sometimes ran counter to solid economic criteria) (Stock, 2008). Nigeria’s major manufactures are food and beverages, cigarettes, textiles and clothing, and detergents, footwear, wood products, motor , chemical products, and metals. Smaller-scale manufacturing businesses engage in , making, making, and woodcarving. The smaller industries are often organized in craft guilds involving particular families, who pass skills from generation to generation. In an attempt to broaden Nigeria’s industrial base, the government has invested heavily in joint ventures with private companies since the early 1980s. The largest such project is the integrated steel complex at Ajaokuta, built in 1983 at a cost of $4 billion. The government has also invested heavily in petroleum refining, , , and implements for assembling automobiles and farm equipment. Government policies have hampered industrial development by making it difficult to obtain sufficient raw materials and spare parts. Partly as a result, only a fraction of the country’s manufacturing capacity is currently utilized. In the mid-1990s the government introduced a series of reforms, including an allowance for greater foreign in Nigerian industries, a loosening of controls on foreign exchange, and the establishment of an export-processing zone at Calabar (Stock, 2008). In a bid to unravel the root cause of unsuccessful efforts towards industrializing the Nigerian economy, the following questions are fundamental to this study: 1. What are the challenges confronting industrialization in Africa? 2. How significant is the contributions of industrialization to Nigeria’s Gross Domestic Product (GDP)? 3. What measure can re-vitalize the growth industrialization in Nigeria?

OBJECTIVE OF THE STUDY The objectives of this paper are: (1) To identify the challenges confronting industrialization in African Economy. (2) To assess the contributions of industrialization to the development of Nigeria (3) To recommend measures that would ameliorate the crisis of industrialization in Africa.

METHODOLOGY Data used in this is derived primary from secondary sources. The methodology therefore, is basically documentary. This involves learning new facts and principles through the study of documents and records. The documents and records include journals, textbooks, newspapers, magazines, official publications etc. By putting together logically evidence derived from documents and records. Conclusion which either established facts hitherto unknown or sound generalization can be obtained.

CONCEPTUAL ANALYSIS AND LITERATURE REVIEW Industry is the production of an economic good or within an economy. According to Anyaele (2003), an industry can be defined as group of firms that produce similar products. Industries can be classified in a variety of ways. At the top level, industry is often classified into sectors: Primary or extractive, secondary or manufacturing, and tertiary or services. Some authors add quaternary (knowledge) or even quinary (culture and research) sectors. Over time, the fraction of a society's industry within each sector changes (Charles, 2000). There are many other different kinds of industries, and often organized into different classes or sectors by a variety of industrial classifications. Market-based classification systems such as the Global Standard and the Industry Classification Benchmark are used in finance and market research. These classification systems commonly divide industries according to similar functions and markets and identify businesses producing related products. Industries can also be identified by product, such as: , , , electronic industry, meatpacking industry, , , fish industry, , paper industry, industry, , , and poverty industry (Charles, 2000).

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In the case of industrialization, Anyaele (2003) conceived it as the policy of establishing many industries in different parts of a country. Industrialization has been generally accepted as the surest and most direct route to economic development of a country. Industrialization is the period of social and economic change that transforms a human group from an agrarian society into an industrial one. It is a part of a wider modernisation process, where social change and economic development are closely related with technological , particularly with the development of large-scale energy and metallurgy production. It is the extensive organisation of an economy for the purpose of manufacturing (Sullivan and Sheffrin, 2003). Industrialisation also introduces a form of philosophical change where people obtain a different attitude towards their perception of nature, and a sociological process of ubiquitous rationalisation. There is considerable literature on the factors facilitating industrial modernisation and enterprise development. Key positive factors identified by researchers have ranged from favourable political-legal environments for industry and commerce, through abundant natural resources of various kinds, to plentiful supplies of relatively low-cost, skilled and adaptable labour. As industrial workers' incomes rise, markets for consumer goods and services of all kinds tend to expand and provide a further stimulus to industrial investment and economic growth. The first country to industrialise was the United Kingdom during the Industrial Revolution, commencing in the 18th century (Lewis, 2003) Technology on the other hand is the making, modification, usage, and knowledge of tools, machines, techniques, crafts, systems, and methods of , in order to solve a problem, improve a pre-existing solution to a problem, achieve a goal, handle an applied input/output relation or perform a specific function. It can also refer to the collection of such tools, including machinery, modifications, arrangements and procedures. Technologies significantly affect human as well as other animal species' ability to control and adapt to their natural environments. The term can either be applied generally or to specific areas: examples include technology, medical technology, and information technology (Liddell and Robert, 1980). Technology can be most broadly defined as the entities, both material and immaterial, created by the application of mental and physical effort in order to achieve some value. In this usage, technology refers to tools and machines that may be used to solve real-world problems. It is a far-reaching term that may include simple tools, such as a crowbar or wooden spoon, or more complex machines, such as a space station or particle accelerator. Tools and machines need not be material, virtual technology, such as computer software and business methods fall under this definition of technology (National Science Foundation, 2007). The word "technology" can also be used to refer to a collection of techniques. In this context, it is the current state of humanity's knowledge of how to combine resources to produce desired products, to solve problems, fulfill needs, or satisfy wants; it includes technical methods, skills, processes, techniques, tools and raw materials. When combined with another term, such as "medical technology" or "space technology", it refers to the state of the respective field's knowledge and tools. "State-of-the-art technology" refers to the high technology available to humanity in any field (George, 1823). The use of the term technology has changed significantly over the last 200 years. Before the 20th century, the term was uncommon in English, and usually referred to the description or study of the useful arts (George, 1823). The term was often connected to technical education, as in the Massachusetts Institute of Technology (chartered in 1861). Julius and Loretta (2005) "Technology" rose to prominence in the 20th century in connection with the Second Industrial Revolution. The meanings of technology changed in the early 20th century when American social scientists, beginning with Thorstein Veblen, translated ideas from the German concept of Technik into "technology." In German and other European languages, a distinction exists between Technik and Technologie that is absent in English, as both terms are usually translated as "technology." By the 1930s, "technology" referred not to the study of the industrial arts, but to the industrial arts themselves (Eric, 2006). In 1937, the American sociologist Read Bain wrote that "technology includes all tools, machines, utensils, weapons, instruments, housing, clothing, communicating and transporting devices and the skills by which we produce and use them" (Bain, 1937). Bain's definition remains common among scholars today, especially social scientists. But equally prominent is the definition of technology as applied science, especially among scientists and engineers, although most social scientists who study technology reject this definition (Donal and Judy, 1999). More recently, scholars have borrowed from European philosophers of "technique" to extend the meaning of technology to various forms of instrumental reason, as in Foucault's work on technologies of the self ("techniques de soi").

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Technology can be viewed as an activity that forms or changes culture (Borgmann, 2006). Additionally, technology is the application of math, science, and the arts for the benefit of life as it is known. A modern example is the rise of communication technology, which has lessened barriers to human interaction and, as a result, has helped spawn new subcultures; the rise of cyberculture has, at its basis, the development of the Internet and the computer.[13] Not all technology enhances culture in a creative way; technology can also help facilitate political oppression and war via tools such as guns. As a cultural activity, technology predates both science and , each of which formalize some aspects of technological endeavor. Classification of Industry

Source: Clark's Sector Model

Sector Definition This involves the extraction of resources directly from the Earth, this includes farming, Primary and . They do not process the products at all. They send it off to factories to make a profit. This group is involved in the processing products from primary industries. This includes all Secondary factories—those that refine metals, produce furniture, or pack farm products such as meat. This group is involved in the provision of services. They include teachers, managers and other Tertiary service providers. Quaternary This group is involved in the research of science and technology. They include scientists. Some consider there to be a branch of the quaternary sector called the quinary sector, which includes the highest levels of decision making in a society or economy. This sector would include Quinary the top executives or officials in such fields as government, science, , nonprofit, Sector healthcare, culture, and the media.

THE CHALLENGES CONFRONTING INDUSTRIALIZATION IN AFRICA In general, manufacturing is an underdeveloped activity in Africa. Countries with more developed manufacturing sectors include South Africa, Zimbabwe, Egypt, Algeria, Burkina Faso, and Côte d’Ivoire. Much of Africa’s modern industrial activity involves the processing of raw materials. Processed foods are largely consumed by Africa’s expanding urban populations, while raw materials such as , petroleum, and timber are processed almost entirely for export. The bulk of the rest of Africa's manufacturing output consists of consumer goods such as textiles, footwear, beverages, and . The technology used in manufacturing ranges from rudimentary tools used in small-scale cottage industries to large-scale factories. Although its impact on the national economy is frequently underestimated, the cottage industry sector of the economy produces significant amounts of goods both for local consumption and for the tourist trade. Textile and footwear plants, on the other hand, can be sizable, often requiring modern machinery. — such as the production of metal, cars, motorcycles, bicycles, and household appliances—is limited to a few

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International Journal of Social Sciences and Humanities Reviews Vol.5 No.1, February, 2015; p.52 – 66, (ISSN: 2276-8645) countries, notably South Africa, Egypt, Algeria, Zimbabwe, Nigeria, and Côte d’Ivoire. Almost all consumer goods produced in Africa are sold and used within Africa rather than being exported (Newman, 2008)

African manufacturing grew in the 1960s and 1970s, but declined in some countries—including Nigeria, Ethiopia, Ghana, Tanzania, Zambia, and Zimbabwe—in the 1980s and 1990s for several reasons; First, many oil-rich countries like Nigeria relied too heavily on extracting and exporting petroleum and neglected their manufacturing sector. Second, war and political unrest disrupted development efforts and caused the role of manufacturing to decline in formerly robust economies like those of Nigeria, Sudan, Ethiopia, and Zimbabwe. The development of African manufacturing has also been hindered by a general lack of investment capital, as well as by misguided economic strategies and corruption. In addition, multinational corporations have tended to discourage African manufacturing, seeking instead to trade their manufactured goods for African raw materials. Africa also has an inherently small market for consumer goods due to its mostly rural, subsistence-oriented population (Stock, 2008). In African countries, on average, the service sector makes up about one-half of the GDP, but employs only about one-third of the labor force. Social services such as education and health services make up the bulk of the African service sector. Formal schooling and modern public health care expanded across much of Africa in the second half of the 20th century. African governments have built countless schools, clinics, and other basic service facilities needed to improve their people’s living standards. Commercial services are less developed in much of Africa. The principal types of commercial services include , communication, , banking, , and import-export agencies. Countries with wealth, such as South Africa and Botswana, or developed tourist industries, such as Kenya, have a much higher level of these commercial services than more agricultural countries like Ethiopia and Ghana. Most commercial service institutions and infrastructures remain concentrated in areas of modern development and major urban centers. The African service sector has several general features, characteristic of less developed areas that combine to limit its impact on national economies. First, the government is often the most important investor and employer, especially in the social services sector (which includes government, civil services, and defense). Second, the most lucrative aspects of the commercial service sector—banking, insurance, tourism, import-export, communication, and transport—are usually owned, controlled, or operated by foreign companies. Third, many of the commercial services required by African smallholder farmers and cottage industry operators—such as transportation and credit services—are provided in the informal market, and are therefore un-documented. As more service institutions become locally and privately owned, and as they extend their reach to small-scale producers, they will benefit African countries’ economies to a greater degree (Stock, 2008). Wood from trees and shrubs is still the most important source of domestic fuel in Africa. Use of and petroleum is limited to urban centers, modern factories, and power plants. In 2003, 79 percent of the electricity generated in Africa was produced by burning coal and other fossil fuels. The most promising source of energy in Africa is hydroelectric power generation. The continent’s many large rivers give it a vast hydropower potential that has barely been tapped. Several major installations have been constructed since 1960, including the Aswān High on the Nile River, the Akosombo Dam on the Volta River, and the Kariba Dam and Cabora Bassa Dam on the Zambezi River. In 2003 African hydroelectric plants produced 18 percent of the electricity generated in Africa. (Mehretu, 2008) Transportation in most of Africa is rudimentary. Most people walk to markets, schools, and health facilities, often carrying needed items on their heads or shoulders. However, bicycles and animal-drawn carts are increasingly available in rural communities. The use of motorized vehicles is mostly limited to cities and intercity traffic by buses and trucks. Throughout the continent, smallholder farmers are unlikely to afford motor vehicles. Bus and train travel is within the means of most people and they are used especially for long- distance travel. The quality and connectivity of African and railroads remain poor: Most roads are made of dirt or gravel, and good quality all-weather roads are limited. Colonial rulers laid railroad tracks to connect ports to export-producing areas in the interior, and these networks have been largely unexpanded since independence. Few roads and tracks cross international boundaries in Africa. The poor condition and disjointedness of the and rail networks have hindered African economic development. South Africa, with higher-quality roads and a greater degree of road and rail connectivity, is a notable exception. Many African countries operate national . South Africa, Egypt, Ethiopia, Kenya, Nigeria, and Ghana have well- developed systems for domestic, international, and intercontinental flights (Shillington, 2008)

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As was the case during colonial rule, Africa’s role in the world economy remains to produce raw materials for use in developed nations. Whatever economic development has occurred in African countries since the end of colonial rule has reinforced this pattern. Investment by international corporations and most foreign governments has concentrated on expanding production of exportable mineral and agricultural raw materials. The emphasis on exports has left inadequate resources for developing domestic industry or changing the traditional, underdeveloped system of African smallholder food production. Neglecting their food- producing sectors has led African countries to increase their dependence on raw-material exports and has required many to import food to feed its people. The continent’s trade position has faced further challenges since the 1960s. The prices of manufactured goods and fuels imported by African countries increased substantially, while the prices of almost all products of African mines and farms declined or fluctuated. This downturn meant that African countries not only had to make do with fewer needed imports, but they also had to go into international debt to meet their financial obligations. Oil-exporting countries were able to avoid this pitfall for a time, but they too were beaten down by the collapse of world oil prices in the 1980s and 1990s. Africa has also been put at a disadvantage by the protectionist trade policies of industrialized countries, which admit unprocessed raw materials tax-free but impose substantial tariffs on imported products made from the raw materials. (Mehretu, 2008) As a consequence of their internationally disadvantaged status, nearly all African countries have had to borrow money from foreign lenders to cover the difference between their export earnings and their spending for imports. The amount of accumulated external debt owed by sub-Saharan African countries has risen from less than $6 billion in 1970, to $80 billion in 1985, to $230 billion in 1999. Interest payments to foreign creditors siphon away precious foreign exchange earnings. Such pressures on export earnings have led African governments to make stringent cuts in imports through high tariffs and outright prohibitions (Newman, 2008).

CRISIS OF INDUSTRIALIZATION IN NIGERIA Sequel to the advent of European colonial rule in Nigeria, some level of technological and industrial development was achieved by a number of Nigerian communities. This was reflected mainly in the manufacture of tools and implements used for different purposes as well as the production of artistic material (Falola, 2008). Indeed, in contemporary times, the relevance of aspects of traditional technology to modern living has been emphasized. Even then, only scanty attention was paid to technological and industrial development by the colonial authorities in Nigeria and the result was that at independence Nigeria’s technological and industrial levels were low compared to the middle-income and developed countries of the world. However, Nigeria’s level of technological and industrial development was similar to what obtained in many other colonial territories. This was because the colonial powers were generally not committed to high level of technological development of their respective colonies (Ake, 1981). In the immediate post independence period, therefore, a major challenge that countries like Nigeria had to face was how to promote rapid technological and industrial development (Adamolekun, 2003). Government Policy was a major impediment to industrialization and economic growth in Nigeria. The problems of infrastructural deficit are well known and documented. The primary problem of industrialisation in Nigeria is a hostile operating environment that creates uncertainties and unmanageable unknowns for entrepreneurs, industrialists, innovators and serious business people; in fact what is certain about the Nigeria industrial environment is uncertainty. We as a people must get out of our way. The Government bureaucratic, regulatory and fiscal policy is a major impediment to Nigeria’s industrialisation, which clearly shows a lack of coherence or coordination from the various arms of government. There are numerous government ministries, agencies and parastatals at federal, state, and local governments’ levels that industry has to contend with constantly.

The problem of infrastructure is a major impediment to industrial growth, there is low electricity generation, and we have not harnessed other means and sources of power and energy generation. The government has turned itself into a parasite, that feeds on the lifeblood of its industry and the manufacturing sector, ask yourself when you sink two boreholes, have your own water treatment plant, have two giant industrial generators, buy tanker loads of diesel periodically, deal with very bad road networks, what exactly are we paying all these taxes, charges, tariffs and levies to government for?

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International business is akin to warfare, we weaken our own ability to compete locally and internationally from within, and we focus on what we call internally generated funds to collect pennies which destroy the ability to create wealth with potential for exponential returns that will grow the economy. We must understand that China that our people seem to see as a panacea to the industrialization of Nigeria and industrial growth supports its businesses. When you deal with a Chinese company, you are dealing with a department and arm of the Peoples Republic of China. The Chinese government supports the deal, favors the Chinese company and guards the interest of China and the Chinese company while the Nigerian government is charging the Nigerian company erroneously focusing on the internally generated pennies rather than a conscious and proactive action for creating and wealth. To promote rapid industrialization, Nigeria must promote high-intensity learning – education and training. Education and training are the instruments for promoting high-intensity learning. Anyone who acquires theoretical knowledge from educational institution, alone, is a mediocre. Similarly, anyone who acquires a small quantity of practical skills from artisan workshop or technical/vocational institutions, alone, is a mediocre (Ogbimi, 1991). The versatile individual is one who acquires both theoretical knowledge and practical skills in great depth and breath. To facilitate a rapid industrialization in Nigeria, Nigeria must do the following: 1) Promote high-intensity education at all levels. 2) Give training outside educational campuses equal emphasis as education. All graduates of tertiary education especially the scientists and engineers should be trained to acquire complementary practical skills in artisans/craftsmen workshops, factory floor work settings, offices and all other places where skill-acquisition opportunities abound. All university science and engineering graduates should be trained 4-5 years, to know how the things Nigeria imports, work and how they are made. The graduates of this training, the industrialization vanguards, should be challenged to build and maintain the necessary infrastructure. 3) Nigeria should adopt full employment policy; let everyone be involved in learning or applying his or her knowledge, skills and competences in production. Unemployment is a national waste ( Ogbimi, 2006). All those in training must be paid adequate stipend to lead a normal life and to maintain high interest and discipline in the training programme. 4)Reduce the number and value of contracts awarded by governments drastically to promote direct labour and to fund the proposed training activities. The training programme is to link the educational sector with the rest of the economy more directly. More importantly, the training programme is to channel the theoretical knowledge generated in educational institutions into the rest of the economy for production purposes. The four steps listed above would initiate rapid industrialization in Nigeria. The impact of the innovation would be evident immediately. The Nigerian economy would approach industrialization when 15 (fifteen) million university science and engineering graduates complete the 4-5 years training for the acquisition of complementary practical skills in the rest of the economy. Mass unemployment, poverty and high crime wave would be eliminated speedily and the quality of infrastructure would improve accordingly.

THE OIL BOOM PERIOD In 1971, the share of agriculture to GDP stood at 48.23 per cent. By 1977, it had declined to almost 21 per cent. Agricultural exports, as a percentage of total exports, which was 20.7 per cent in 1971, reduced to 5.71 percent in 1977. The discovery of oil in commercial quantity in the mid-1950s, coupled with the oil-boom resulting from the Arab oil embar go on the USA in 1973, affected the agricultural sector adversely. The economy became heavily dependent on oil. By this time, oil revenue represented almost 90 per cent of foreign exchange earnings and about 85 per cent of total exports. While the boom afforded the government much needed revenue, it also created serious structural problems in the economy. The agricultural sector was most hit. Rural urban migration increased, as people attempted to reap or benefit from the windfall from oil. Produc tion of agricultural for export declined. Food production became a problem. Starting from 1974, the economy became a net importer of basic foods. Huge foreign exchange earnings were utilised in importing food. Nonetheless, prices of foodstuff remained high. Policies like the government's Operation Feed the Nation (OFN) programme could not reverse the deteriorating food situation. Government was involved in direct food production, provided subsidies to peasant farmers and created more boards for various agricultural and food products. The growth rate of GDP was quite high, such that a growth rate of 10.5 per cent in 1976 was considered unimpressive. Government expenditure fuelled the inflation rate. Between 1975 and 1976, the rate of inflation reached 23 per

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International Journal of Social Sciences and Humanities Reviews Vol.5 No.1, February, 2015; p.52 – 66, (ISSN: 2276-8645) cent. It reduced to 16 per cent in 1976 and 1977. For the same periods, unemployment rate was 4.3 per cent and 2 per cent respectively. The discomfort index in 1976 stood at 27.3 per cent. The neo-Keynesian type management of the economy was glaring during this period. Policy makers advised the government not only to embark on ownership and control of the commanding heights of the economy like the petroleum and mining sectors, but also to be directly involved in banking, insurance, clearing and forwarding, among others. With the promulgation of the Nigerian Enterprises Promotion Decree in 1972, Government became directly involved in virtually all aspects of the economy, especially as foreign exchange was thought to be no longer a constraint to development. This era had its problems. Primitive accumulation intensified. Corruption, theft, real estate speculation, outright looting' of government treasury and other fraudulent practices prevailed. The State, on its own, intensified the creation of a business class that depended solely on government contracts rather than on production. The gap between the rich and the poor widened considerably. Ad-hoc and ill-conceived government policies exacerbated the problem. For example, the 100 per cent salary increase of 1975, tagged the Udoji Salary Award, was disastrous tor the economy as prices increased by more than 100 per cent. The payment of a year's arrears of the increase in salary further worsened the situation. The exchange rate regime encouraged imports. The economy was heavily dependent on imports; almost everything was imported, from toothpicks to toothpaste dispensers. There was no serious attempt to invest the windfall from oil in viable projects. Except for the huge expenditures on education and construction of dual carriage highways in some parts of the country, Nigeria would have had nothing to show from the oil boom era. The industrial sector also depended on imported inputs, machinery and raw materials. Hence, the so- called manufacturing and mining industries (using 1972 as the base year), which indicate remarkable increases, appear misleading. The manufacturing sector increased by 82.2 per cent between 1972 and 1976 and by almost 94 per cent between 1972 and 1977. The increases must be interpreted with caution, if industrialisation is seen to imply the process of developing the capacity of that country to master and locate, within its borders, the whole industrial production process, namely production of raw materials, production of intermediate products for other industries; fabrication of the machines and tools required for the manufacture of the desired products and of other machines and tools, skills to manage factories and to organise production processes. Declining oil revenues, disequilibrium in the balance of payments, growing unemployment, increasing rate of inflation and political instability, all confirmed that demand-induced policies were no longer effective. By 1978, a country which had thought that foreign exchange was not a constraint on development went borrowing on the Euro-dollar market. Despite the oil boom, the private sector remained weak. The existing macroeconomic policies continued to encourage consumption rather than production. The economy was consuming what she was not producing. The austerity measures introduced by the military administration under General Olusegun Obasanjo were short-lived because structural problems were not addressed. GDP, which grew at 10.5 per cent in 1976 declined by 5.7 per cent in 1978 and grew by only 5.9 per cent in 1979. Consequently, the economy entered the recessionary phase, requiring further stabilisation measures to reverse the gloomy situation. Nigeria’s agricultural productivity today is about 10 per cent of global average. If all Nigerians are employed in agriculture, how would Nigeria begin to manufacture scientific products in the near future? Are automobile, air planes, chemicals and luxury textiles which Nigerians import manufactured by agriculturists in the farm in Britain, the USA and Japan? No! What Nigeria needs is rapid industrialization, not employing the entire workforce in artisan/craftsman .

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Table 1. NIGERIA’S SECTORAL SHARE IN REAL GROSS DOMESTIC PRODUCT (PERCENT) Year Agric Petroleum Mining& Manufac. Build.&Const. Wholesale& Services Quarr. 1981 34.7 1.4 1.3 9.9 17.2 13 22.4 1982 35.8 12.5 1.3 11.2 3.8 13.6 22 1983 37.7 12.8 1 8.4 3.5 14 22.6 1984 37.8 15.2 0.9 7.8 3 13 21.6 1985 40.3 15.1 0.5 8.6 1.9 13 20.6 1986 42.7 13.8 0.3 8 1.8 14 20.3 1987 41.5 12.5 0.3 8.4 2 13.6 21 1988 41.5 12.3 0.3 8.6 2 13.8 21.4 1989 40.5 13.2 0.3 8.2 2 13.4 22.4 1990 39 12.9 0.3 8.1 1.9 12.7 25 1991 38.6 13.4 0.3 8.5 1.9 12.5 24.7 1992 38.3 13.4 0.3 7.9 1.9 12.5 25.7 1993 37.8 13.1 0.3 7.3 2 12.6 27 1994 38.3 12.6 0.3 7.2 2 12.5 27.4 1995 38.8 12.6 0.3 6.6 2 12.2 27.5 1996 39 13.1 0.3 6.5 1.9 11.9 27.3 1997 39.4 12.8 0.3 6.3 2 11.7 27.4 1998 40.1 11.6 0.3 6.2 2.1 11.6 27.8 1999 41.3 9 0.3 6.3 2.1 11.8 29.2 2000 40.6 11.5 0.3 6 2.1 11.5 28 2001 40.4 11.6 0.3 6 2.3 11.3 28.1 2002 41.2 9.7 0.4 5.5 2.6 11.3 29 Source: CBN Annual and Statement of Accounts, for the above years.

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Table 2.LIST OF COUNTRIES BY INDUSTRIAL OUT PUT AND GDP COMPOSITION Largest countries by industrial output according to IMF, 2013 Economy Countries by industrial output in 2013 (billions in USD)

European Union 4,255 (01) China 4,086 (02) United States 3,118 (03) Japan 1,354 (04) Germany 1,007 (05) Russia 797 (06) Brazil 646 (07) Canada 525 (08) France 515 (09) India 515 (10) United Kingdom 509 (11) Italy 502 (12) South Korea 501 (13) Saudi Arabia 483 (14) Indonesia 445 (15) Mexico 436 (16) Australia 434 (17) Spain 366 (18) Turkey 230 (19) Norway 225 (20) United Arab Emirates 207 Rest of the World 5,870 The twenty largest countries by industrial output in 2013, according to the IMF and CIA World

The analysis in table above shows that the industrial performance of Africa as continent was so inconsequential it was included among the rest of the world that recorded insignificant results in the secondary sector of their economy. By implication, most of the so-called advanced nations of the world have consistently maintained improved performance in their industrial sectors.

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Table 3.COMPARATIVE ANALYSIS OF AFRICA STRUCTURE OF REAL GDP IN 2000 (PERCENTAGE SHARES) REGIONS COUNTRIES SECTORAL GROUP

Agriculture Manufacturing Other Activities Africa Nigeria 41 6 54 Cote d”Ivoire 29 19 52 Kenya 20 13 67 South Africa 3 19 78 Asia Indonesia 17 26 57 Malaysia 11 33 56 Japan 1 22 77 Latin America Mexico 4 21 75 Venezuela 5 14 81 Europe Germany 1 23 76 Sources: Underlying data on Nigeria obtained from FOS National Accounts of Nigeria, 2000 while data on other countries are obtained from World development Indicators, World , 2002.

The structure of real GDP as presented in the table above indicated that most African countries and Nigeria in particular recorded low percentage scores compared to its counterparts in western nations of the World. It is also important to note that the contribution of agriculture to GDP in South Africa which is in the same continent with Nigeria was in the single digit of less than 4.0 per cent. The same goes with other developed countries like Mexico. Venezuela, Germany and Japan, even among the oil producing countries (Nigeria, Indonesia, Mexico and Venezuela) as presented in the Table, Nigeria has the highest contribution of agriculture to GDP than manufacturing. The implication of this analysis so far is that, with the exception of Nigeria, all other oil producing countries have been more successful in developing their manufacturing sector. It is apparent that Nigeria is lagging behind both oil and non-oil producing countries in the process of industrialisation. In short, Nigeria has experienced little or no transformation of its industrial structure, with the primary industry dominating. This observed phenomenon could be adduced to a low volume of investment and productivity in the manufacturing industry. The structural changes that brought about the few level of growth recorded in the manufacturing industry could be attributable to series of deregulation measures since 1986. The challenge for Nigeria at this point is to articulate policies and programmes that will accelerate the pace of manufacturing and industrial activities so as to catch up with countries like Malaysia, Indonesia and South Africa especially in the medium term. The analysis so far shows that the Nigerian economy has a built-in structure of high import dependency. An increase in domestic demand induces a large increase in imported intermediate, finished and capital goods through direct and indirect linkages. This industrial and trade structure with heavy reliance on imported inputs has resulted in the increasing deficit on current account, which is one of the most serious problems the Nigerian government is facing in recent years. Given the rapid international trend towards the trade liberalisation and globalisation, an economy without strong basic industries or supporting industries can neither enjoy the emerging opportunities nor sufficiently compete in the international market. It is therefore essential for the Nigerian government to formulate appropriate industrial and trade policies aimed at fostering competitive basic industries or supporting industries without adopting protection measures.

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CONCLUSION AND RECOMMENDATIONS Industrial growth and development of Nigeria is the responsibility of Nigerians and international Diaspora Nigerian experts. The Chinese, Lebanese, Indians Americans or Germans are not going to do it for us; I believe with the right Government policy, strategy and leadership Nigerian industrial transformation can be achieved. We must understand the role of the Nigerian expert is critical, to the industrial development of Nigeria. The greatest weapon in the fight for this transformation and industrialisation is brainpower, knowhow and expertise, we must do everything in our power to find, engage and import our own experts languishing in the Diaspora across the globe. That is how Taiwan did it, we can do it too, we should and we must do it, we

Figure 3.4: Comparative Analysis of Structure of Real GDP in 2000

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must be willing to do everything it takes to bring our own experts home. From the Agribusiness perspective, Nigeria has strategic advantage in Cassava, Tomato, rice, oil palm, fruits and vegetables, where we can become the global centre of excellence for cultivation and transformation to value added food and industrial products. We must end80 the banana republic culture of 64

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Agriculture Manufacturing Other Activities International Journal of Social Sciences and Humanities Reviews Vol.5 No.1, February, 2015; p.52 – 66, (ISSN: 2276-8645) shipping our agricultural treasures in raw unprocessed form to other countries to support their industry, we must end this wanton unmitigated export of our raw materials with no value addition, for the sake of our country and economy, for the sake of our progeny; this is not the future we should bequeath our children. We must industrialise this nation, and I believe that Nigerians have what it takes to implement an industrial transformation plan for Nigeria.

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Sullivan, A. and Steven, M. (2003): Economics: Principles in action. Upper Saddle River, New Jersey 07458: Pearson Prentice Hall. Central Bank of Nigeria Statistical Bulletin , various issues. Central Bank of Nigeria Annual Reports and Statements of Accounts , various issues. National Science Foundation (2007):"Industry, Technology and the Global Marketplace: International Patenting Trends in Two New Technology Areas". Science and Engineering Indicators 2002.

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