UNJYERSXTY OF NIGERIA, NSUKKA

DEPARTMENT OF MECHANICAL ENGINEXRING

TOPIC:

INDUSTRIAL BACKWARDNESS OF THIRD WORLD

COUNTRIES AND NIGERIA IN PARTICULAR: WHICH WAY

OUT?

A TERM PAPER

PRESENTED IN PARTIAL FULFILLMENT OF THE

REQUIREMENT OF THE COURSE G. S. 104 (SOCIAL

SCIENCE)

BY

OSUEBI C H U W J E M E K A

REG NO: 2006/143907

LECTURER: I.E. UKWUARA I!

JUNE, 2008.

TITLE PAGE

INDaZS'bR3CAb BACKWARDNESS OF

THIRD WORLD COUNTRIES AND

NIGERIA IN PARTICULAR:

WMTCM WAY OUT?

DEDlCATlON

This work is dedicated to the most high God the maker of

heaven and earth for his kindness and grace upon my I

dedicate this work to my hl~rnble family and friends for

both financially and other wise.

life. Finally 1

their support

ACkiYOWLEDGEMENT

Most importantly I acknowledge the almighty God for the

inspiration he gave to me to compile this work and the success so far

on my academics.

T wish to acknowledge with deep sense of gratitude the authors,

publishers and or individuals wlme works were cited in this work.

Finally 1 also thank all those wlio made this term paper a

success. T want to say I love you all.

PREFACE

The goal of this term paper, industrial backwardness of third

world countries and Nigeria in particular; which way out is to

highlight some factors which causes industrial backwardness,

consequences and sohtions to industrial backwardness in third would

countries and Nigeria in particular.

Chapter one contains the introduction, defhtion of terms and

some major points why Nigeria is chosen as a case study of industrial

backwardness.

Chapter two contains / treats the possible factors which leads to

industrial backwardness while chapter three deals with the

consequences of industrial backwardness.

Chapter four which contains the crux of the term paper deals

with solution (way out) to the longstanding problem of industrial

backwardness in Nigeria. Finally chapter five contains the summary /

conclusion and references.

TABLE OF CONTENTS

CHAPTER ONE

1.0 INTRODUCTION - - .. - - - 1

1.1 Definition of term - - - - - - 2

I .2 What is industrialization - - - - - 2

1.3 What is industrial bacLxardness - - - - 3

1.4 Third world countries - - - - - - 3

1.5 Why is Nigeria important as a case study of industrial

backwardness - - - - - - - 3

CHAPTER TWO

2.0 FACTORS THAT LEADS TO JNDUSTRTAL

BACKWARDNESS - - - - - - 5

2.1 Administrative constraints and a restritive industrial

policy - a - - - - - - 5

2.2 Political influence I instability and government policy - 5

2.3 A small size market for industrial goods - - - 6

2.4 Low man power skill - - - - - - 7

2.5 A Jack o f adequate research and a delay in completing

feasibility studies - - - - - - - 8

CHAPTER THREE

3.0 CONSEQUENCES OF INDUSTRIAL

BACKWARDNESS - - - - - - 9

3.1 Inhibition of economic growth and development - - 9

3.2 Unemplo-pent- - - - - - - 10

3.3 Hinder craftsmanship - - - - - - 10

CHAPTER F O t X

4.0 POSSIBLE SOLUTIOYS TO INDUSTRIAL

BACKWARDNESS - - - - - - I 1

4.1 To diversi6 the economy

4.2 Making industrial policy which will favour foreign

investors - - - - - - - - 11

4.3 Increase market size for produced goods - - - 12

4.4 Improve standard of education - - - - 12

4.5 Provision and maintenance of infiastn~ctural facilities - 1 3

CHAPTER FIVE

5.0 SUMMARY ,' CONCLUSION - - - - 14

Bibliography

CHAPTER OXE

1.0 l[NTRBDUCTION

?'he international system have been undergoing tremendous

changes since the cessation of the divisive and delibilitating cold war

in 1989. Apart from being witnessed in political and economic scene,

the Post - Cold War c l ~ a n ~ e s are also profound in the industrial sector.

This cold be observed from immense industrial and economic

transfortnation taking place in the developed cowtries like, china,

Hong kong, Taiwan, united states of America (USA), Europe, Egypt,

Germany etc.

As the impressive industrial revitalization process is being

witnessed in different part of the world, one is apprehensive about the

future of the third world countries, (developing countries) with

Nigeria in particdar. +this is ccmsiderins the higering stagancy and

backwardness o f the cormtry, which is endowed with enormous

li~m~an, natural and material resources but yet is not making

sipificant indwttial headway which countries like united states,

Japan, China and others, which do not have mrtch resource have

recorded.

Following the Ions lastins industrial baclnvardness in the

developing counties, the objective of this term paper is to address the

factor responsible for industrial backwardness, the consequences and

most importantly the way out of the problem specifically in Nigeria.

1.1 DEFINlTlORT OF TER,MS

1.2 WHAT 1s TND~~STRIALIZ4TION

Industrialization is a phenomenon in the development of

nations, characterized by the _ero~vtJi of machine and power tools

production. The growth of mechanical and technical skills

( tecllnolo~~) C - required for indristrial production, with attendant large

scale production, all of which leads to changes in the social and

economic organisation, society. Indirstria!ization is a process, which

increase the vol~irne of production in industrial activities such as

manrrfact~rring, construction, etc. As industrialization proceeds. Its

total output of the indush-ial sector, as a percentage of nation output

increases.

1.3 W H A T IS INDWTR I A L BACKM'ARDNESS

Industrial backwardness can be defined as the phenomenon

whereby the volume of production in industrial activities is decreased.

Tt could be experience within a particular season in a particular place.

Moreover, as industrial backwardness persist the total output of the

industrial sector, as a percentaze of nation output decrease.

1.4 THIRD WORLD COtlNTRIES

This are the countries which are less developed as compared to

developed counties like United State, Japan, China, etc. They are the

counties where the standard of living is ~rnfavourable to the common

tnembers of the society. Thev can also be called developing countries.

This countries include: Nigeria, Ghana, India, Zimbagwe, among

others and are highly known for their indmtrial / economic

backwardness.

1.5 WHY IS NIGERIA IMPORTANT AS A CASE STUDY OF

l NnUSTRIAL R,tG h71'A RQNKSS

Nigeria has the bigzest population in Africa with 1 in 6

Africans beins Nigerian. Nig,eria has a peat deal of influence in West

African. I t is an important member of ECOWAS (the economic

comrntmity of West African stated and plavs a central roIe in

industrial market system in Afhca.

Having the above mentioned features, it will not be wrong to

say Nigeria economy is the backbone of some economic system in the

developing countries of A-Fn'ca hence the need for a h m over in the

industrial sector of the comtry.

CHAPTER -mlrQ

2.0 FACTORS THAT LEAD TO INDITSTRIAL

RACKWARQNESS

2.1 ADMINISTR,4TIVE CONSTRAINTS AND A RESTRICTIVE

INDUSTRlAL POLICY

There are certain government restriction and administrative

bottlenecks which fixstrate entrepreneurs and prevent the setting up of

certain industries. These include the difficulty in getting licenses or

permits because of the very many authorities from whom these have

to be collected. Approval for setting up an industry is thereby delayed.

Sometimes taxation is usrlafly high. Also, there may be lack of chear

guidelines with regards to payment of royalties, license fees and

technical fees. All these tend to limit industrial development.

2.2 POLITJCAL INFLCTENCBE / TNSTARILIXY AND

GOVERNMENT POLICY

These have led to the location of industrial in economically

unviable areas. Since these two factor are important factors industrial

location in third world countries and the worId at large, they have

constituted obstacles to good industrial performance. They have

resulted in many industries being established which have performed

far below the optimum.

The third world counties are also faced with incessant internal

inprisings, coups d'etat, etc. 11ese create an atmosphere of fear and

insecurity, therebv discouraging investment in industry.

E there are frequent crises in a country, the attention of the

government will be primarily focused on dealing with such crises

rather than on development of indushy. Indigenous entrepreneurs

would not be encourage to invest. In addition foreign entrepreneurs

would be seaned away, thereby discouragins investment hence

leading to industrial backwardness.

2.3 A SMALL SIZE MARKET FOR TNDUSTRlAL GOODS

There is an inadequate demand for goods in the third kvorld

countries. This is due to the small size of population of some

co~intries, and the low income per capital, with the exception of

Nigeria, with the Jmze popdation of over 140 nill lion, and some other

large developing co~mh-ies, many developing countries have small

popdations. This mean the potential market for industrial goods is

small in many countries.

Tt has beera diflicdt to set up iron and steel industries, car

manufacturing industries, etc. in some developing conntries because

of the low demand.

2.4 LOW MAY POWER SKILL

Skilled industrial manpower is scarce in developing countries.

The shortage of skilled industrial manpower is partly due to the high

degree of illiteracy which placed greater emphasis on gmnrnar

subjects has led to a shortage of manpower suitable for industrial

development.

The shortage of skilled labour has hindered the establishment of

heavy engineering industries in developing countries. It has also

brought about reliance on foreip manpower. Dependence on foreign

skills labour has its shortcomings. Among them i s that such people are

mually highly paid. and this reduces business profit. Again, it results

in a drain in foreign exchange due to the reloatriation of money over

seas.

2.5 '4 LACK OF ADEQUATE RESEARCH AND A DECAY IN

COMPLETING FEASIRILIT'I' STUDIES

The shortage of required manpower has led to inadequate

research in matters relating to industrial development, since the

amount of research done is still so small, it has not been possible to

over come certain constraints which result in industrial backwardness.

The shortage of personnel has also delayed the completion of

feasibility shrdies before an industry is established; it is necessary to

determine its viability. In developing countries, this may take a long

time to do became of the shorta~e of personnel. In some cases, such

feasibility studies are not undertaken. Tlie result is that industries,

wl~icli are estaldished, may not be viable after all. They fold up after a

s1101-t period of operation.

T l~e shodage of indigenous personnel has led to reliance of

foreign experts wid1 their usual shortcomings.

CHARTER THREE

3.0 CONSIQUENCIES OF IINDIISTRIAL BACDYARDNESS

3.1 JNAIBITJON OF ECONOMlC CROFVTFI AND DEVELOPMENT

Industrialization stapated from the late seventies onwad.

Output per capital Nigeria declined. and so did the share of industry in

Gross Domestic Prodnct (GDP) within indushy, the share of

manufacturing stagnated. Viis situation has made sotne economic

scholars to draw conclr~sions that Nigeria. in a s+vmptom of its general

declines, is de - industrializing.

The industrial growth in Nigeria so fir has been mainly due to

import - substitution industrialization (ISI), resulting until mid -

1970s in growth rates similar to those of sub- Sahara countries

realized for their economic performance almost singularly on the

export of prima? products, improcessed raw materials, and were

unable to substantially c h a n ~ e the colonial Features, and inherent

restrictions, of their economics.

A birds - eye view of the present predicament of Nigeria shows

that economic performance has been poor, especially since the

be@nming of 1980s. With GDP yowth rate consistently falling below

population growt11 sates, rewlting in a fall in per capital income.

3.2 UNEMPLOYM EiVT

Unemployment is one of the major consequences of indmtrial

backwardness and also a nations backwardness both in other sectors

like economic sector, political sector, agicultmal sector etc.

Today one may gaduate with a first class honour in any

university and remain jobless because of lack of job opportunities,

which is as a result of industrial and economic decline.

3.3 HINDER CRAFTSMANSNTP

Most of the goods, which are manufactured in several places,

cotltains several raw materials which are mainly produced in the rural

areas bv craft men or talented people. Due to the devastating nature of

the economy, such talents may not be ed~ibited due to financial

constraints.

CHAPTER FOUR

POSSlBLE SOLIITlONS TO lNDllSTRIAt

BACJGVARDNESS

TO DIVERSITY THE ECONObW

The magic wand for the developing co~mtries is economic

diversification, the significant emphasis being placed on harnessing of

development catalytic sectors like tecl~nology, industrialization, mine

/ power / steel, private initiative etc.

Having emphasized the foregoing, the need for diversifying the

Nigeria economy for growth cannot be under scored. As a step in this

direction, the Federal Government should start working towards

reversal of the mono economic profile of the country by placing fewer

premiums on oil export as means of our national sustenance.

4.2 MAKlNG INDUSTRIAL POLICY WF-TICH WILL FAVOUR

FOREIGN IN\:ESTOIR

Foreign investors are sometime scared of investing in the third

world counties due to the fact that most times government policies

tends to restrict them from normal operation.

Therefore it is wise for our government to make policies, which

will promote foreign investment which will in t ~ r r n promote the

industries sector of our great nation.

4.3 INCREASE MARKET SIZE FOR PRODUCED GOODS

Manv developing co~uitries have small populations. This mean

that potential market for industrial ~ o o d s is small in many countmes.

It has been difficult to set up some industries in developing

countries became of the how demand for goods produced by siich

industries. This is as a result of a small size market for such goods

therefore; the government pthlic and private sectors should help to

increase the market size for produced _eoods. This can be done by

creating a wav for exportation of produced good to some other

counties and also by restricting the rate of importation of some

certain goods, which are produced in the country.

4.4 IMPROVE STANDARD OF EDUC.4TIBN

The standard of education in Nigeria is very low. This is the

reason why most people who are well to do travel aboard for

education. Pupils or students are not well equipped with facilities for

13

learning. This problem has lead to low technical manpower skill for

industrial improvement. The government should used the money

which is normally allocated for vocational training to better the

education system of the nation. By so doing individuals on different

field will improve on their technical skills and industrialization will be

boosted.

4.5 PROVlSlON AND MAINTENANCE OF

JNFRASTRUCTURAL FACILITIES

Infrastructural facilities like electricitv, water etc are vital il

some manufacture industries. The rate of supply of electricity in

Nigeria is not encouraging, this could result in the increase in the

piice of manufactured good due to other expenses like, using

electrical generatins plan, bumins of diesel and firel in the course of

production. Of course, such experiences will always cause the price of

commodity produced to increase this is done so as to recover the sum

of money spent in the course of production. Adequate supply and

maintenance of infiastnrctural facilities will help to and such

situations.