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Importation is the bringing into the country of foreign goods. It is the practice where by goods are transported or moved from countries or places where it is in abundance to countries that are not self-sufficient. It’s a way of enjoying what is necessary to the well being of the people in a place where they cannot be found. Normally, some countries have certain products in abundance (competitive advantage), while others do not and in trying to balance things up, importation become a vehicle. EFFECT OF IMPORTATION ON THE ECONOMY Importation is good where a country does not have the potential to produce the products in question but when a country has what it takes to produce such products and still embark on importation, the local economy is bound to decline. In the case of Nigeria, the last administration did all it could to help small and medium enterprises by establishing an Agency called Small and Medium Scale Development Agency (SMEDAN), but the country’s increase in importation of raw materials especially those that can be produced locally is negatively affecting the Agency. The following tables shows the effect of importation on local manufacturers within 5 years.

2001 Ibadan: P/H: Lagos: Kano: 40 32 80 50 2002 45 34 85 55 2003 48 36 89 57 2004 50 40 120 62 2005 56 48 200 68 These industries were supposed to manufacture semi-raw materials for other industries for further processing of finished goods for the Nigerian populace.100 . The table below show employed workers in industrial sectors in Nigeria from 2001 – 2005 . due to our preference for imported goods to home made goods.Table 1: Shows the registered SME in Nigeria between 2001 and 2001 2002 98 240 1200 400 2003 120 260 2000 600 2004 350 300 2500 1000 2005 450 400 2900 1500 2005 in some selected states of Nigeria. The No of Small and Medium industries keep reducing in no. Ibadan: P/H: Lagos: Kano: 110 220 950 350 The increase or decrease in registered outlets is matched by a corresponding decrease or increase in employment as shown below. 2006 2007 2003 2.500 2. But as importation began to increase.200 2. This can be observed from the table below in Lagos. in some selected states in thousands.

5 1150 1.6 MARGINAL INCREMENT OF THE RAW MATERIALS Sugar Wheat Starch 2001-2002 130 62 0.3 1010 1. Also.1 The table above shows that the importation of wheat was on the increase every year except in 2002-2003 that it decreased.2 2002-2003 86 98 0.1 2003-2004 105 100 0. the importation and its effect on local raw materials in Lagos industries are shown below in million tones.4 1110 1. 2006 2007 2008 180 150 110 More also. that of sugar increases for 3years and finally came down drastically due to some other companies that sprang up in Nigeria as small producers’ Joseph Dam and .1 2004-2005 91 40 0.1 912 1. in thousands. The next two tables shows the drop in employment within these three years. Importation between 2001 – 2005 2001 Sugar 204 2002 334 2003 420 2004 525 2005 616 Wheat Starch 850 1. However.The values for 2008 is part projection giving by the rate at which they decrease. it should be noted that not all industries out there in Lagos market are registered.

2 2007 – 2008 66 300 0.4 Sugar Wheat Starch Marginal increment table Sugar Wheat Starch 2006 – 2007 40 200 0. 2006 680 1000 1. AIM AND OBJECTIVE OF THE STUDY The aim and objective of the study among others are : To find out i.Bachita Sugar industries. they were forced to shut down especially in Lagos state.6 The above table shows that the marginal increment of all the raw materials are on the increase. This can be attested to by the rise in food stuffs world wide this year.6 2007 720 1200 1. The marginal increment of raw materials especially for Lagos State in importation for 2006 – 2008 is shown below. 2008. But between year 2006 – 2008. iii. . due to the closure of some small industries partly due to their inability to compete with the foreign materials. due to low productions. ii.8 2008 786 1500 2. If importation would help the local economy If importation would standardize the local products. If importation would help Mr. But starch is relatively stable all through the year. foreign exchanges etc.

It has totally paralyzed the economy to such a level that our country has become a dumping ground for foreign goods even of lower standards to what our local industries can do. Statement of Hypothesis The following hypothesis would be tested in this research (i) (ii) (iii) H0: H0: H0: Importation is important to Nigeria economy Importation would standardize Nigeria economy Importation would help our foreign exchange earning DEFINITION OF TERM Importation: Economy: The buying of goods from country of origin (manufacture) to The state of domestic affairs in a country. But it has never been as worse as this. country of consumption. (c) Statement of Problems The problem of importation has always been the take of any giving economy like Nigeria.Research Questions The following research questions are what the research would answer: (a) (b) Is importation important to the Nigeria economy? Would importation help the foreign exchange earnings of Nigeria? Would it help to standardize Nigeria products?. .

CHAPTER THREE 3.CHAPTER TWO 2. It’s not news that the African Union (AU) has always clamour for Africa to solve their problems themselves rather than looking else where for solution. This has been the bane of human development especially in Africa. The recent policies/of the UN especially on Millennium development Goals have shown that over 60% of poor people lives in Africa.0 METHODOLOGY .0 Literature Review Economist have always been of the opinion that any country that wants to grow economy should develop its internal production system to facilitate its own growth rather than depending on importation.

(i) Population The population size for this study are the people in small and medium scale businesses within Lagos. REFERENCES . (ii) Population sample: The population sample for this study is about 50 industries out of the many lots that engage in small and medium scale businesses. (vi) Collation and Method of Analysis This data would be collated and analysed using descriptive and inferential statistics. (iv) Data/Instrument of Data collection: In this study. This would be collected(primary) using questionnaire (that has been validated). primary and secondary data would be used. it is then administered to the sample population. After validation. (v) Validation and Administration of questionnaires The questionnaire is validated by a group of experts in the field of Small and Medium Scale Industries before it is used for the research of study. (iii) Method of selection: The population samples would be picked by random techniques.The research would be carried out by the following methods.

Board of Governors of federal Reserve system (U.fos-ng. Rebel A. page 959-977. “The importance of relationship to the availability of credit”. N. Finance and Economic discussion series. (3) www. The importance of bank organizational structure. www.(1) Allen.federalministry of (4) (5) NAME: MATRIC NO: TOPIC: GLORIA UGOH 021003119 THE EFFECT OF IMPORTATION . 2001 – 36. Journal of Banking and finance. 22 (6-8).org www. Kalell (2001). “Small Business credit availability and relationship lending”.S). (2) Cole.ghrain. Berger and Gregmy. F. vol. 1998.