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Economy, Manufacturing

Jebba, craft guilds, Akure, Bauchi, Katsina

In 2000, manufacturing accounted for 4 percent of the GDP, down from 13 percent in 1982. Preindependence Nigeria, its large population notwithstanding, had very little industrial development—a few tanneries and oil-crushing mills that processed raw materials for export. During the 1950s and 1960s a few factories, including the first textile mills and food processing plants, opened to serve Nigerians. During the 1970s and early 1980s industrial production increased rapidly, principally in Lagos, Kaduna, Kano, and Port Harcourt. Factories also appeared in smaller, peripheral cities such as Calabar, Bauchi, Katsina, Akure, and Jebba, due largely to government policies encouraging decentralization (although these policies sometimes ran counter to solid economic criteria).

The largest industrial sectors, in number of establishments, are food and beverages; textiles and clothing; wood and wood products; fabricated metal products and machinery; paper products; and chemical, petroleum, coal, rubber, and plastic products. While many of the businesses in these sectors are large, others are small and labor-intensive, such as enterprises for weaving, leather making, pottery making, and woodcarving. The smaller industries are often organized in craft guilds involving particular families, who pass skills from generation to generation.

In an attempt to broaden Nigeria’s industrial base, the government has invested heavily in joint ventures with private companies. The largest such project is the integrated steel complex at Ajaokuta, built at a cost of $4 billion but still not operational after almost 20 years. The government has also invested heavily in petroleum refining, petrochemicals, fertilizers, and implements for assembling automobiles and farm equipment. Government policies have hampered industrial development by making it difficult to obtain sufficient raw materials and spare parts. Partly as a result, only 30 percent of the country’s manufacturing capacity was utilized in 1996. In the mid-1990s the government introduced a series of reforms, including an allowance for greater foreign ownership in Nigerian industries, a loosening of controls on foreign exchange, and the establishment of an export-processing zone at Calabar.



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