A Comparitive analysis of Nigeria and South African Industrial Development
INTRODUCTION
Prior to and immediately after independence, Nigeria was seen as a country with great growth potentials. In fact, Nigeria was termed the giant of Africa. But one may be tempted to ask the question ‘what actually went wrong with her industrial sector?’ This paper seeks to comparatively analyze the problems that seem to perpetually keep Nigeria behind its allies using South Africa as a case study.
By implication, if Nigeria can vigorously address its challenges using the South African model, she will not only come out of its industrialization dilemma, but will reclaim its position as the giant of Africa. This is because, no country can claim to be developed in modern days without being industrialized.
COMPARISON BETWEEN NIGERIA AND SOUTH AFRICA
NIGERIA
1 Mono Economy
Nigeria’s high growth rates have been driven by consistently high crude oil prices. Indeed, the story about Nigeria’s growth is predominantly about oil. The primary engine for such high oil prices on the world market has been demand from BRICS countries: Brazil, Russia, India, China and South Africa. However, since the 2008 global financial crisis, BRICS countries have been showing signs of struggling, with growth forecasts for this year cut by almost half. If oil demand continues to weaken due to their sluggish economic performance, Nigeria’s economy could prematurely plateau in a manner analogous to Japan
Diversified Economy
On the other hand, South Africa’s economy is more diversified, and as a result, its growth rate, though more measured, is likely to be steady
2 Small entrepreneur
Nigeria has, in comparative terms, a smaller entrepreneurial community than South Africa. Dependency on oil appears to have profoundly discouraged would-be innovators and entrepreneurs from other sectors, such as the ‘smart’ industries of finance or telecommunications. With the exception of well–established conglomerates such as the Dangote Group, Nigeria also struggles with
Prior to and immediately after independence, Nigeria was seen as a country with great growth potentials. In fact, Nigeria was termed the giant of Africa. But one may be tempted to ask the question ‘what actually went wrong with her industrial sector?’ This paper seeks to comparatively analyze the problems that seem to perpetually keep Nigeria behind its allies using South Africa as a case study.
By implication, if Nigeria can vigorously address its challenges using the South African model, she will not only come out of its industrialization dilemma, but will reclaim its position as the giant of Africa. This is because, no country can claim to be developed in modern days without being industrialized.
COMPARISON BETWEEN NIGERIA AND SOUTH AFRICA
NIGERIA
1 Mono Economy
Nigeria’s high growth rates have been driven by consistently high crude oil prices. Indeed, the story about Nigeria’s growth is predominantly about oil. The primary engine for such high oil prices on the world market has been demand from BRICS countries: Brazil, Russia, India, China and South Africa. However, since the 2008 global financial crisis, BRICS countries have been showing signs of struggling, with growth forecasts for this year cut by almost half. If oil demand continues to weaken due to their sluggish economic performance, Nigeria’s economy could prematurely plateau in a manner analogous to Japan
Diversified Economy
On the other hand, South Africa’s economy is more diversified, and as a result, its growth rate, though more measured, is likely to be steady
2 Small entrepreneur
Nigeria has, in comparative terms, a smaller entrepreneurial community than South Africa. Dependency on oil appears to have profoundly discouraged would-be innovators and entrepreneurs from other sectors, such as the ‘smart’ industries of finance or telecommunications. With the exception of well–established conglomerates such as the Dangote Group, Nigeria also struggles with
References: 1 http://nigeriavillagesquare.com/articles/guest-articles/the-missing-link-in-nigerias-industrialization-efforts.html 2 http://www.businessdayonline.com/NG/index.php/analysis/commentary/45851-nigeria-and-south-africa-africas-economic- powerhouses- 3 http://www.news24.com.ng/Business/News/Corruption-hinders-Nigerias-superpower-prospects-20130522