THE EFFECT OF LACK OF BASIC INFRASTRUCTURE ON THE PRODUCTION CAPACITY AND GROWTH OF SMALL SCALE PRODUCING FIRMS IN NIGERIA

THE EFFECT OF LACK OF BASIC INFRASTRUCTURE ON THE PRODUCTION CAPACITY AND GROWTH OF SMALL SCALE PRODUCING FIRMS IN NIGERIA

(A CASE STUDY OF SELECTED PRODUCING FIRMS IN IMO STATE)

ABSTRACT

The study focused on the small scale enterprises and economic development in Nigeria.  Along the line, problem hindering the expansion of small-scale enterprises in both Imo State and Nigeria at large were identified.  The purpose of the study was stated, statement of problem made and related literature reviewed out of the existing small scale enterprises located in Imo STATE.  Few of them were selected for the research work through random sampling techniques.  Data were obtained by means of questionnaires, personal observation, interview e tc.  The data collected were analyzed by using the percentage proportion.  It was indicated from the study that small scale enterprises have indeed made useful contributions to the economic development attainment of Nigeria in such way, as providing employment.

CHAPTER ONE

1.0     INTRODUCTION

1.1  BACKGROUND OF THE STUDY

        Economic development of a nation is a function of enterprises existing within the country.  Business enterprises do not matter the scale or size contribution in various ways of boosting economic development.  However, it is worthy of note that small-scale enterprises are more predominant in our society.

       In our society, various forms of small-scale industries exist performing various roles.  It is worthy of note that these industries naturally are expected to contribute to the well being of citizens to around them.  The specific attention on them is based on their expected impart and potential contribution on board and diversified production base as well as their accelerating effect in achieving macro objectives pertaining of full employment, income distribution and the development of local technology.  Hey are particularly most conducive for diffusion of management skills and stimulation of indigenous entrepreneurship over time.

       Unfortunately, because of profit initiative most of these industries have failed to perform the expected roles.  The government is now left with all activities for development of our nation.  It is not unusual seeing activities in Owerri as nearer to the people and better understanding of their need.  They are expected to provide employment, social amenities, pay  tax to government and performs other roles.

       But the question is to know what extent do they perform these roles.  Do they see themselves as a partner with the government in development of nation or as parastatals?  With the consistence of people in this trade over time had brought with it increase income and better well being.  The market for their output has endangered and local market for their output has endangered and local employment seemed to have been reduced.  The major policy thrust of the present administration in Owerri Imo State in Nigeria is the provision of infrastructural support for private section manufacturing especially in the rural areas, promotion of export oriented industries and the acquisition of industries know-how through the design adoption and modification of industrial machinery, components and spare parts.

       Thus, it is government  intension and policy to give the private sector every reasonable assistance to ensure the spread of industries in the state.  It is good to note that Ukata Pure Water is in Imo STATE. Also it is good to note that Owerri is int eh fore-front purpose where foreing technology is being adopted and modified for local application.

       A good number of industrial machinery and equipment is being produced especially for small scale manufacturers.  It appears that government has realized that it is about time they come together to their rescue by giving support to them.

       The under listed are small scale machinery found in Owerri Imo State which have aid in development of small-scale industries.  These include machines for soap making, candle making, palm cracking and pressing, juice extraction, block molding, oil milling, bread and cake making (Bakery enterprises), hair dressing saloon, furniture and cabinet construction, automated cassava processing machines for garri production as well as water sealing machine and labeling machine (for pure water industry)etc.

       The government of Owerri Imo State have helped them through the provision of fund for small scale industries.  These economic activities engaged by Ukata Pure Water industries increased  economic growth and development in Imo State.  In addition, small-scale business is managed to encourage Nigeria enterprises promotion, which was promulgated for the country and to attract foreign investment to area where it would be more meaningful in the econ omic development of the nation.  They need to know and observe economic regulations as directed by the federal ministry of finance and the      Central Bank of Nigeria (CBN). 

       Equally, they are expected to diversify their activities and work into those areas of needs of the people.

1.2  STATEMENT OF THE PROBLEM

       Nigeria government joined other countries of the world in emphasizing the establishment of small-scale enterprises which is characterized by small-scale industries which its size would not be for elaborate administration structure to play observable role in economic development.  Consequently, those roles are felt only little due to the following:

1.  Insufficient capital.

2.  Lack of vital business information

3.  Lack of education and technology

4.  Deteriorating sales

5.  Bad debt.

6.  Lack of basic amenities.

1.3  OBJECTIVES OF THE STUDY

        The objectives/purpose of the project is:

1.  To assess and evaluate the activities of small-scale enterprises towards economic development of Owerri in Imo State particularly and Nigeria in general.

2.  To determine if small-scale business contributes to the economic development in Nigeria.

3.  To examine the extent of which small-scale business provided employment in Imo State.

4.  To determine the factors against small business in Nigeria.

1.4  RESEARCH QUESTIONS

1.  To what extent does a small-scale enterprise contribute to the economic development of Nigeria?

2.  To what extent does a small-scale enterprise improve the economic condition of the nation?

3.  For what reasons do people engage in small-scale enterprises in Nigeria?

1.5  SIGNIFICANCE OF THE STUDY

        One way of solving problem is to study the particular problem.  When the causes are identified and diagnosed, then possible solutions can be used.  The government and people of Imo State will have a lot to gain from, this project work.  Such gain will include:

1.  This study will help to increase public patronage of small-scale industries by creating awareness about the high quality products they produce and the need to patronize out local industries.  Many people are afraid to patronize our local industries but with the help of this study, Owerri people will have the confidence to patronize their industries and it will also help to realize the fact that if they patronize our support local enterprises, they are paving way for the future economic and development.

2.  The study will help the government and people of Owerri in Imo State to realize the problems facing  small-scale enterprises in the state and offers suggestion on how t o tackle these problems.

3.  The small-scale enterprises provide a good training ground for the development of industries by encouraging people to develop entrepreneurial capabilities management and technological skills.  It helps indigenous  small scale enterprises to acquire managerial skills.

1.6     SCOPE OF THE STUDY

Due to the numerous contribution of small-scale enterprises to the development of Owerri Imo State and Nigeria in general, it will be cumbersome to highlight all of them and give them the adequate attention they require.  This study therefore will be limited to the study of small-scale enterprises development of Owerri Imo State, using Ukata Pure Water Industry as a case study.

1.7  LIMITATION OF STUDY

        A number of limitation of factors were responsible for the inability of the researcher to carry out a holistic investigation in this research work, which may affect the result of this work.  The factors or problems encountered during this research work include lack of finance for transportation, time constraint, pressure and lack of research facilities, etc.

       The researcher find it difficult to combine both lectures/studies and time for going for research of this work in order to see that he/she carries out the research work and studies effectively.  They are the factors that limited the researcher in carrying out this work effectively.

• Economic Activities:  Is any legitimate activity that man engages in with the sole aim of earning a living.

• Enterprise:  This simply means a business concerned i.e. a company or business.

• Economic Development:  This involves improving the state of cities, ways of thinking, methods of production etc.  It also involves improving our general standard of living.

• Credit Facilities:  A type of loan made in a business or corporate finance context.

• Small Scale Enterprises:  They are enterprises where there is limited skill and capital requirement and it is usually owned by one person who could be the manager or the proprietor with a limited number of employees.

• Industries:  They are composed of a number of firms which can be regarded as the units of control.  They are group of firms that produce the same types of goods.

• Determination:  This means the quality that makes you continue trying to do something when it is difficult.

• Development:  This gradual growth of something so that it becomes more advanced, stronger etc.

• Investment:  This is the act of investing money in something, e.g. t o encourage foreign/private investment.

• Competition:  This is a situation in which people in organizations compete with each other.

• Commodity:  This is a product or a raw material that can be bought and sold, especially between countries.

• Involvement:  The act of taking part in something.

• Labour:  This means work especially physical work.

• Product:  This is something grown or produced usually for sale.

• Productivity:  The rate at which a worker, a company or a country produces goods and the amount produced, compared with time.

• Stimulate:  To make something develop or become more active.

• Limitation:  This is the extent or level/unit at which something has reached to.

• Research:  This means an organized systematic scientific method of collecting information to solve an immediate problem.

•  Conformance:  This is the degree to which a product design and operating characteristics come close to a standard.

• Performance:  It refers to the level at which the product primary characteristics operates