EXPORT MARKET PENETRATION OF NIGERIAN PRODUCTS: THE MYTHS AND REALITIES.
Need help with a related project topic or New topic? Send Us Your Topic
DOWNLOAD THE COMPLETE PROJECT MATERIAL
EXPORT MARKET PENETRATION OF NIGERIAN PRODUCTS: THE MYTHS AND REALITIES.
Chapter one
Background of the study
1.1 Introduction
The ultimate goal of any country’s government is to achieve a well-developed economy, which can be represented by the realisation of macroeconomic objectives such as equitable income distribution, price stability, and economic expansion.
As a result, a variety of policies and tactics can be used to achieve these objectives. While some countries favour an inward-looking import substitution model that allows them to evolve their own development methods and take control of their own destiny, others believe in an export-oriented strategy.
Nigeria, like many other developing countries that had previously adopted an import replacement policy under the economic nationalism philosophy, has now switched to an export promotion strategy after realising that it was more effective than import substitution in achieving faster growth and structural upgrading of an economy.
Many scholars refer to export promotion strategy as governmental efforts to expand the volume of a country’s exports through export incentives in the form of public subsidies, tax rebates, special credit lines, and other kinds of financial and non-financial measures designed to promote a greater level of economic activities in export industries so as to generate more foreign exchange and improve the current account of the balance of payments. Todaro (2003).
According to the literature, export commerce is a growth driver. It boosts foreign exchange earnings, strengthens the balance of payments, creates jobs and promotes the growth of export-oriented industries in the manufacturing sector, and enhances government revenue through taxes, levies, and tariffs.
These gains will eventually translate into better living conditions for the exporting economy’s citizens, since foreign exchange earned will help them satisfy their needs for some critical goods and services.
However, before these advantages can be fully realised, the structure and direction of these exports must be carefully designed so that the economy does not rely solely on one sector for the provision of required foreign money.
In the early years after independence, the Nigerian economy relied reliant on agricultural commodity exports to survive. However, as a result of the federal government’s establishment of a commodity board to operate as a buying agent, this board set prices arbitrarily and below market pricing, and farmers left the company since it was no longer lucrative.
The policy resulted in a negative development of agricultural exports. Furthermore, available data suggested that the manufacturing sub-sector of the economy had a limited contribution to exports.
Colonial overlords neglected the industry before independence, focusing on exporting industrial raw materials for their local industries.
Even after independence, weak infrastructure, a lack of suitable financing, high production costs, and little market penetration due to poor quality control hampered the growth of manufacturing exports.
Need help with a related project topic or New topic? Send Us Your Topic