Globalization and Stagnant Growth of Industries in Nigeria and Sub-Saharan Africa

Globalization and Stagnant Growth of Industries in Nigeria and Sub-Saharan Africa

Globalization and Stagnant Growth of Industries in Nigeria and Sub-Saharan Africa –   Obviously, one major problem and consequences of globalization in Sub-Saharan African countries has been the weakening of the manufacturing sector. This situation is not the same with the regions (East Asia) that have based growth on rapid industrialization and structural transformation.

Their exchange rate, trade and other polices have ensured relative prices favourable to export industries as opposed to non-trade-ables), with preferential interest rate and other financial policies supporting investment and economic restricting. Sectoral strategies have involved a mix of import substitution and export promotion and investment export nexus, including measures to support public investment, subsidize input (from state owned enterprises, sometimes with preferential  credit and special exchange rates, establish direct subsidies (including tax incentives) and introduce  selective credit allocation and other industrial policy instrument (Akyuz and Gore, 1996).
Moreover, when most other developing countries strategies on import substitution industrialization in 1930s and the 1950s, sub-saharan African countries remain under colonial rule for much of the period and well in the 1960s. as a result, import substitution phase in most of Sub-Saharan Africa was relatively short, lasting barely for ten years in many countries due to the lateness of independence and the early onset of economic slowdown owning to oil shocks of 1970s (Mkandawize 1988) import compression following the debt crisis constrained capacity  utilization and investment preventing many countries Sub-Saharan African countries including Nigeria from adjusting positively to the changed global environment. In this context, trade liberalization, beginning in 1980s, prematurely exposed African infact industries to global competition against much more this forced import liberalization. With the Washington consus presumption that import substitution must be bad, there was little attempt to consider how industries might be the bases for new export initiatives. Presuming that sub-saharan African importation substituting industries had been protected for far too long and would never become viable, let alone internationally competitive despite considerable evidence to the contrary from northeast Asia the policy preference was simply to abandon existing industrial capacity, precipitating deindustrialization.
As a result, manufacturing value add (MVA) in Nigeria and sub-saharan African grew at disappointing 1.9 percent annually between per annum between 1990 and 1995. The already  ting share of global manufacturing value added for sub-saharan African countries decreased further from 1.0 percent in 1980 to 0.8 percent in 2000 UNIDO 2004, p.184. Now the overall deindustrialization in Sub-Sahara African has been severe as reflected in table 2 of my material which report the GDP composition of Sub-Saharan economies excluding south Africa, both by expenditure and by broad categories value added. First, adjustment as prescribed by BW’s has insisted on reducing government expenditure, which tell from an already low 16 percent GDP in the 1970s to 13 percent during 200-2008. Even the critical level was low compared to the developed world and such cut have not only affected social spending but also economic expenditure e.g on infrastructure. These declines in public investment went hand in hand with discouraging private manufacturing investment UNCTED, 2003. It is thus not suppressing that the average share of manufacturing in value added tell to 8 percent from 2000 to 2008.
Again, in the regions major petroleum exporting countries, the share of manufacturing in value added tell even more drastically from 12 percent in the 1970s to 5 percent during 200-2008. The reduced share of government spending since the turn of the century reflects the commodity boom and related GDP growth for oil exporting Sub-Saharan African countries such as Nigeria. This low shares stand in marked contrast to Asian developing countries, where the manufacturing sector is responsible for 27 percent total value added during 2000-2008 and are markedly lower than average for all less developed countries.

African Growth in a Changing Policy Environment

Real income growth failed to keep pace with the rapid growth rate of population in Sub-Saharan African between 1970 and 200. After posting a modest average annual growth rate in real per capita income of about 0.7 percent during the 1970s,  these rates turned negative between 1980s and 1990s falling 1 percent and 0.5 percent respectively. Since 2000, Sub-Saharan African countries have posted improved growth rates, largely thanks to primary commodity-driven recoveries and most seem to have recovered relatively quickly from the global economic crisis. Even so, average real per capita income is still barely higher than in 1970 and Sub-Saharan Africa fell behind all other regions on most development indicators. The regional average also conceals vast differences within the continent, where countries have profited from the commodities boom since 2000. Furthermore, the wreak and often erratic growth performances have been accompanied by regressive trends in income distribution in many countries, with a particularly marked drop in the average per capita income of the poorest 20 percent in Sub-Saharan Africa. Not only is this likely to undermine human resource development. In the 1960s, per-capita gross domestic product and social as well as political cohesion in Sub-Saharan Africa, it may restrict future growth prospect.
Historically, this development failure was unexpected and seems a lot less unavoidable than the longstanding intro-pessimistic’ discourse on Africa’s economic development would have us believe. In the 1960s, per capita gross domestic product (GPP) and GDP growth were higher in Africa than Asia, and expectations then were that African countries would grow fasters due to their superior resource endowments. However, they failed to adjust to changing global economic conditions and went on to experience over two lost decades of development from the 1970s until the early 200s we will argue that a key explanation for this growth and human development disaster has been the radical change in Africa’s development policies from 1980s. Liberalization and privatization measures aimed at integrating into global markets and attracting investment have replaced admittedly problematic state interventions and public ownership, notably the support for infant industries. Ironically, while policy debates during the pre-liberation development era seriously considered the interactions between external and internal factors the liberalization era has tended to focus almost exclusively on the domestic determinants of economic performance, assuming that external market forces are always benign with strong positive influence on economic performance and prospects.
Many of this citations explain that the good and the bad of globalization in the world’s economy with Nigeria and Sub-Saharan African countries suffering the negative influences of it on international trade while the industrialized nations of the world like Germany, USA and  so on enjoy the huge of benefit of globalization. As most perhaps, almost all the countries of sub-saharan African including Nigeria are at disadvantage in partnering with industrialization countries of the world because of high level of illiteracy, over reliance of foreign made goods and services, ignorance, political instability corruption, poor infrastructural facilities, and intermittent power supply that characterize the economics of Sub-Saharan Africa and Nigeria as well.

Conclusions and Recommendations

Those in authority should map out policies and programmes aimed at revamping the economics of sub-saharan Africa through being good leaders themselves. They should try to observe the provision of constitution of their various countries. They should slow corruption in all aspects.
In the same vein, the citizens of this country Nigeria and likewise that of sub-Saharan African countries need to emulate the economic  lifestyle of the advanced nation for them to be able to compete favourably in international transactions. They should embrace western education, shun and say violence and distribution of lives and public property. The people of sub-Saharan African countries have to pay more attention to various workshops organized either by government or private individual aimed at sensitizing the public on dangers of some social voices in the society. The youth should learn how to be hardworking as hard work together with determination and motivation will always usher in success in all its ramifications be  it education, business, agriculture or any field of life and sector of the economy.
Actually, if these are achieved and done, developing countries such as Nigeria and that of Sub-Saharan Africa will no longer suffer unfavourable balance of payment, unfavourable balance grade, high external debt and many other negative consequences of globalization as weaker partners in international trade today in the world global market.

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