CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Most developing nations define industrialization as a central objective of their economic policy they see; industrialization goes with agricultural progress as an integral part of growth and structural change. Some economist and analysts are of the view that industrialization plays a major role in the economic growth and development of any nation.
Thus in this research work, effort is made to assess the impact of industrialization on economic growth of Nigeria. Before colonial rule in Nigeria, there were numerous economic activities undertaken by Nigerians. Nigerians were among the most active and industrious group of people in Africa. The economic activities were based mostly on primary production especially on agriculture. Such activities were engaged in, included farming, hunting and quarrying. The coming of the white men to Nigeria recorded more changes in life style of Nigerians. The economy was changed from its agricultural based to a market based for imported manufactured product.
The colonial masters at the same time took the Nigerian economy as a base for the supply of resources both mineral and agricultural raw materials for industries in their own country. The worst aspect of it was that they exploited these resources at a cheap price, but when their product was brought into Nigeria, the prices were placed so high to exploit the nation.
Furthermore, the colonial lords at no times endeavoured to industrialize Nigeria, and Nigerians were not motivated to involve themselves in industrial activities. All these contributed to Nigeria being both technologically backward and industrious.
The attainment of political independence by Nigeria in 1960 made it possible for the 1st national development plan in Nigeria in 1962. The main aim of this plan was for industrialization. Industrialization in Nigeria was aimed at the achievement of import substitution and even export promotion.
Industrial development and economic growth are necessary in any developing country. In an economy where there is availability of industries, the majority of unemployed people will engaged themselves in productive activities. If industrial development is well encouraged it will be of great help to the developing economy and it will also go a long way in enhancing economic growth.
Industrialization is the process through which the primary based economy becomes industrialized.
According to Ojo (1987:256) industrialization could be seen as the process by which the industrial sector of such a country or region increases its share in gross domestic product (GDP), employment, poverty alleviation efforts, investment and so on. From the works of Shaw and Emer(2000:13) industrialization is the process where manufacturing becomes increasingly important in the economic structure of the society.
According to Holis, Bacheney (1999:624) said that industrialization is the main hope of most countries trying to increase their level of income. Industrialization in Nigeria has the idea of transforming the peasant or idle workers of Nigeria into full time or part time industrial workers and on the other hand it will transform the structure of Nigerian economy. The standard of living of the people in the economy will be improved and economic growth is gingered.
1.2 STATEMENT OF PROBLEMS
The need for industrialization has become one of the problems facing Nigeria. Not with standing that industrialization can lead to economic development, creation of employment pportunities, increases in productivity, increase in foreign exchange etc.
Insufficient capital is one of the reason Nigerian economy is termed underdeveloped or developing. Huge amount of capital is needed for an industrial development because it is a capital project that needs both labour intensive and capital intensive in abundant. When such funds are made available for industrialization and it is not properly utilized, it tends to create problems in the economy.
Presently in Nigeria, there are sources of finance specified to industrial sector made available by the government but in spite of them many industries have gone into collapsing while a good number are making effort to survive. The provision of finance for industries is generally problematic world-wide and is therefore not specific to developing countries like Nigeria.
The study is therefore necessary to enable a thorough investigation of financial problems of the industrial sector especially that of the manufacturing industries and various government agencies setup to provide credit facilities to the industrial sector to ensure the continual growth of this sector for rapid economic development of this nation. This work intends to find out,
(a) Does industrialization have any impact on economic growth in Nigeria?
(b) What is the nature or relationship between economic growth and industrialization?