Fix Industrialization for a better Nigeria

By Tunde Eso 

Industrialization has long been recognized as a key driver of economic development, and for Nigeria, it represents a critical pathway toward achieving sustainable growth and reducing poverty. However, despite its vast natural resources, Nigeria has struggled to fully industrialize in a way that promotes long-term prosperity. To build a better future, Nigeria must fix its approach to industrialization, addressing the current challenges and creating an environment conducive to robust industrial growth.

The importance of Industrialization for Nigeria, is a process by which an economy transitions from primarily agricultural activities to more complex manufacturing and service industries. In Nigeria's case, successful industrialization holds the potential to diversify the economy, reduce its dependence on oil exports, and create jobs for millions of citizens. A well-developed industrial sector could also increase Nigeria's global competitiveness, encourage foreign direct investment, and support the development of critical infrastructure.

However, Nigeria's industrialization efforts have faced significant challenges, which hinder the country from fully reaping the benefits of industrial growth. These include poor infrastructure, regulatory bottlenecks, inadequate human capital development, and a reliance on raw material exports rather than value-added manufacturing.

My personal research revealed that their are some key challenges to Nigeria's Industrialization- which is infrastructure deficits which is one of the most glaring obstacles to industrial growth in Nigeria is its inadequate infrastructure. The country struggles with unreliable electricity supply, poor road networks, inefficient ports, and limited access to water and sanitation. For industries to thrive, reliable power is essential, and the lack of it forces many manufacturers to rely on expensive and polluting diesel generators. Similarly, inefficiencies in transportation and logistics increase costs and reduce the competitiveness of Nigerian products in the global market.

Power supply issues through electricity remains a critical issue for industrialization in Nigeria. With frequent power outages and an overburdened grid, many industries are forced to rely on alternative power sources, which significantly raises operating costs. Resolving the energy crisis would have a ripple effect, reducing costs, increasing productivity, and improving the overall business environment.

Over-reliance on oil exports while oil and gas have been the backbone of Nigeria's economy for decades, this over-dependence has prevented the growth of other sectors, especially manufacturing and processing. As global demand for oil fluctuates and prices become volatile, the country's economy remains vulnerable to external shocks. Diversifying the industrial base beyond oil and gas is crucial for long-term stability and resilience.

Weak manufacturing sector in Nigeria's manufacturing sector has not reached its full potential. Despite having a large population, abundant natural resources, and a young workforce, the country has failed to develop a competitive and efficient manufacturing industry. This is due, in part, to inconsistent policies, high interest rates, and insufficient access to capital. Many manufacturers face difficulty in obtaining affordable credit, stifling their ability to scale operations and invest in modern technology.

Regulatory and policy instability business owners in Nigeria frequently complain about the complex regulatory environment, which can be burdensome and unpredictable. From inconsistent taxation policies to bureaucratic delays, the business climate often fails to support industrial expansion. The lack of a clear and stable industrial policy discourages investment and innovation, creating a cycle of uncertainty that stifles growth.

Human capital development-while Nigeria boasts a youthful population, the country struggles with gaps in education and skills development, particularly in technical and vocational fields. The industrial sector requires a skilled workforce capable of operating advanced machinery and maintaining complex production systems. Unfortunately, the mismatch between the skills acquired in schools and those needed in industries limits the effectiveness of the labor force.

For us to overcome the aforementioned some key challenges to Nigeria's Industrialization we need to fix industrialization in Nigeria through Invest in Infrastructure to unlock industrial potential, Nigeria must urgently address its infrastructure deficits. Improving access to reliable electricity, modernizing roads and transportation networks, upgrading ports, and improving communication systems should be top priorities. Public-private partnerships (PPPs) could be used to finance many of these infrastructure projects, ensuring that the necessary capital is available while minimizing the burden on government resources.

Enhancement of energy supply and efficiency solving Nigeria's power crisis is critical for industrialization. A mix of renewable energy sources, including solar, wind, and hydro, should be explored alongside investments in the country's oil and gas infrastructure. Privatizing and streamlining the power sector could encourage competition, attract private investment, and improve overall efficiency. Government incentives for the use of alternative energy sources in industrial operations could help reduce the burden on traditional power grids.

Diversify the economy in Nigeria must reduce its dependence on oil by nurturing other sectors such as agriculture, manufacturing, and technology. By creating value chains around its agricultural products (such as processing and packaging by promoting made in Nigeria products), Nigeria could develop a strong, diversified industrial base. Encouraging the development of small and medium-sized enterprises (SMEs) is also critical, as these businesses often drive innovation and contribute significantly to job creation.

In Nigeria we should made policies that we create a business-friendly regulatory environment reforming the regulatory and taxation systems would make it easier for businesses to start, grow, and thrive. Simplifying procedures for setting up businesses, reducing the time it takes to obtain permits, and ensuring that tax policies are clear and consistent would create a more attractive environment for both local and foreign investors. The government should also focus on enforcing contracts and tackling corruption to build a trustworthy business climate. 

We should promote skill development and vocational training in Nigeria to invest more in human capital development to create a workforce capable of driving industrialization. This means improving the quality of education at all levels, focusing on science, technology, engineering, and mathematics (STEM) subjects, and strengthening vocational training centers to equip young people with practical, marketable skills. Collaboration between industries and educational institutions can ensure that curricula are aligned with the needs of the job market.

More so, leverage technology and innovation embracing the fourth industrial revolution will be essential for Nigeria to remain competitive in a rapidly changing global economy. The government should foster innovation by investing in research and development (R&D), encouraging entrepreneurship, and supporting tech startups. Leveraging digital technologies like artificial intelligence, automation, and blockchain can help Nigeria modernize its industrial base, increase efficiency, and create new business opportunities.

Importantly, to encourage Foreign Direct lnvestment (FDI), Nigeria should position itself as a hub for foreign direct investment by creating incentives for international companies to invest in local industries. This could include offering tax breaks, simplifying investment procedures, and ensuring that foreign investors have access to the resources they need, such as a skilled workforce and reliable infrastructure. Attracting FDI could help introduce new technologies, expertise, and capital into Nigeria's industrial sector.

Conclusively, fixing industrialization in Nigeria is not an overnight task, but it is essential for the country's long-term economic success. By addressing critical challenges like infrastructure deficits, energy shortages, and regulatory inefficiencies, Nigeria can create a more favorable environment for industrial growth. With the right policies, investment in human capital, and commitment to diversification, Nigeria has the potential to build a robust, diversified economy that benefits all Nigerians and other nations, because one of my vision ingredient is actualization of industrialising Nigeria to feed all nations been the mother of numerous natural resources. The time to act is now, because industrialization is key to unlocking the country's future prosperity.

• Tunde Eso, Political Scientist, National President of Fix Nigeria Group and Inventor of Youthocracy and Visionocracy-new system of governments. He can be reached through tundeeso8@gmail.com; 08038272210.