Nigeria MANUFACTURING
Punch press with operators
Courtesy Embassy of Nigeria, Washington
While agriculture's relative share of GDP was falling,
manufacturing's contribution rose from 4.4 percent in FY
1959 to
9.4 percent in 1970, before falling during the oil boom to
7.0
percent in 1973, increasing to 11.4 percent in 1981, and
declining to 10.0 percent in 1988. Whereas manufacturing
increased rapidly during the 1970s, tariff manipulations
encouraged the expansion of assembly activities dependent
on
imported inputs; these activities contributed little to
indigenous value added or to employment, and reduced
subsequent
industrial growth. The manufacturing sector produced a
range of
goods that included milled grain, vegetable oil, meat
products,
dairy products, sugar refined, soft drinks, beer,
cigarettes,
textiles, footwear, wood, paper products, soap, paint,
pharmaceutical goods, ceramics, chemical products, tires,
tubes,
plastics, cement, glass, bricks, tiles, metal goods,
agricultural
machinery, household electrical appliances, radios, motor
vehicles, and jewelry.
From 1982 to 1986, Nigeria's value added in
manufacturing
fell 25 percent, partly as a result of inefficient
resource
allocation caused by distorted prices (especially for
exports and
import substitutes) and prohibitive import restrictions.
Between
1986 and 1988, World Bank structural adjustment program
(SAP)
measures contributed to larger increases in
manufacturing's
contribution to GDP, which grew 8 percent in 1988. These
measures
included liberalized regulations governing the import of
capital,
raw materials, and components; the creation of importsubstitution industries; and, beginning in 1988,
privatization.
The SAP increased production efficiency, cut into the
black
market, and reduced factory closures resulting from import
bans
on essential inputs.
The Nigerian Enterprises Promotion decrees of 1972,
1977, and
1981, by limiting foreign ownership shares in various
industries,
shifted the manufacturing sector from foreign majority
ownership
in the 1960s to indigenous majority ownership in the
mid-1970s
and late 1970s. Businesspeople participated in economic
policymaking, influencing the government's implementation
of
indigenization. "Nigerianization," in which foreigners
were
obligated to sell ownership shares to Nigerians, became an
instrument by which a few civil servants, military
leaders,
businesspeople, and professionals amassed considerable
wealth. In
1985 the government selectively relaxed the indigenization
decrees to encourage foreign investment in neglected
areas, such
as large-scale agrobusiness and manufacturing that used
local
resources. After March 1988, foreign investors were
allowed to
increase their holdings in a number of other sectors.
Data as of June 1991
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