7 - Recent Trends and Patterns in Nigeria’s Industrial Development

Abstract

This paper analyses recent trend and spatial patterns of manufacturing in Nigeria.In particular, the paper shows that industrial development in the country involved considerable artisanal crafts firms in the early stages and grew progressively in number over the years to large-scale manufacturing. The pattern of the distribution of manufacturing industries at the city level indicates that there is a marked concentration of manufacturing establishments in the southern part of the country, and especially Lagos, Ibadan and Benin in the southwest. Other locations of relative high concentration of industrial establishments are Kano in the North; and Enugu and Port Harcourt in the southeast. Although, this paper shows that production subcontracting increased and varied amongst subcontracting firms, production subcontracting relationships are concentrated in a few locations. The paper concludes that the spatial pattern could change if industrialists adopt the strategy of industrial linkages, and especially production subcontracting which has become a driving force in contemporary industrial development efforts in the world today. It is expected that the situation could be better enhanced given the ongoing privatisation of industrial concerns in Nigeria. RésuméL'étude analyse les tendances récentes et les structures spatiales des industries manufacturières au Nigeria. Il montre notamment que le développement industriel dans le pays impliquait, à ses débuts, un nombre considérable d'entreprises artisanales qui se sont progressivement développées en nombre au cours des années pour devenir des industries manufacturières d'envergure. La structure de la distribution des industries manufacturières dans les villes montre qu'il y a

Infrastructure, Human Capital and Industrialization in Nigeria

“…Recent studies (Ajayi, 2007;Akinwale, 2000) document that investment in infrastructure such as roads, communication and utilities stimulate private investment. The availability of infrastructure in the right quantity and quality deepened the competitiveness of domestic firms in the export markets.…”

Influence of subcontracting constraints on the performance of manufacturing industries in Nigeria

“…This is evidenced by an increasing number of publications and studies on the topic (Ajayi, 2001(Ajayi, , 2002(Ajayi, , 2003(Ajayi, , 2007Berry, 1997;Diaz-Mora & Triguero-Cano (2007); Dahane, Clementz, & Rezg, 2008;Dahane, Dellagi, Clementz & Rezg, 2011;Deardorff & Djankov, 2000;Furlan, Grandinetti, & Camuffo, 2007;Grossman & Helpman, 2005;Gubik, 2005;Hajej, Rezg, & Gharbi, 2014;Kongmanila and Takahashi, 2009;Nwokocha et al 2015a;Nwokocha, Madu, Ocheje, Olerum, & Nwosu, 2015b;Taymaz and Kiliçaslan, 2002;Tuan and Yoshi, 2010;Watanabe, 1971). According to these studies, subcontracting helps small and medium scale enterprises as well as large scale firms to stimulate, reduce, and control operation cost in manufacturing, improve company's focus, and to access world class capabilities, develop joint maintenance and production strategies amongst others.…”

“…In Nigeria, subcontracting; a strategic positioning of industrial activities started in the early 1960s, the post-independence period (Ajayi, 2007). The earliest stage in the adoption of production subcontracting as an industrial production technique in Nigeria was characterised by insignificant growth and rapid growth thereafter.…”

“…Industrial linkage is the interrelationship amongst various industrial activities through the input-output relationship or the economic value chain (Mayhew, 2009). Subcontracting which is a type of industrial linkage based on alliance is a work contract that externalise production processes from one firm to another through interfirm relationships (Ajayi, 2007). In developing countries, business linkages with local small and medium enterprises, including procurement, distribution and sales, offer large firms an avenue through which to address some of these concerns.…”

“…The earliest stage in the adoption of production subcontracting as an industrial production technique in Nigeria was characterised by insignificant growth and rapid growth thereafter. Subcontracting became very important after the introduction of the Structural Adjustment Programme in 1986, and it is perceived by industrialist as very important in reducing the cost of production (Ajayi, 2007) and most recently following the works of Nwokocha, Madu, Ocheje, and Olerum (2015a), subcontracting is very important in enhancing the operational efficiency in industries, induce specialisation so as to gain professional resources and to strengthen cooperation amongst industries.…”