Government Regulation And Control Of Business In A Developing Economy (A Case Study Of Sunrise Flour Mills Nig Ltd)

Project and Seminar Material for Business Administration and Management BAM

Government Regulation And Control Of Business In A Developing Economy (A Case Study Of Sunrise Flour Mills Nig Ltd)


The significance of government regulation and control of business in a developing economy lies in the fact that with laid down rules (laws) guiding the operation of business organization particularly in developing economy, their would be all sorts of business malpractices that will not hinder the growth and development but also drawn the economy.

The task of the research work is to investigate and examine government regulation and control of business in developing economy using Sunrise Flour Mills Nigeria Plc as a case study with the view to establish why government regulates and control business is to identify general acceptable solution to their problems.

In this course of research, primary and secondary sources were used to obtain information. Having analysed the data tested, the researcher discovered the following:

  1. That government regulation and control of business in developing economy has not really done much in the area of sound development.
  2. That there is instability in government policy which leads to the various abandonment of many plans and programmes scheduled to regulate and control the business organization.
  3. That government is liable to meeting up with the demand of regulating business organization developing economy.
  4. That over-regulation of business activities is mostly responsible for the year performance of business organization.
  5. That all system of regulation and control of business in developing economy is uncoordinated etc.

The researcher recommended the following:

  1. That government regulation and control of business should conform with system developing economy.
  2. That they should deregulate some of the information.
  3. That relevant information should be disseminated to business organization.

Chapter One


1.1 Background of the Study

This could be traced back before, the independence of Nigeria. Then, there was little or no manufacturing taking place. The role envisaged for the colonies by our colonial masters was that of producers of raw materials and consumers of finished products. Planned industrial development did not really commence until after Nigeria gained her sovereignty, there was change in economic activity due to the power shift from the colonial masters to the Nigerians. (INDIGENISATION POLICY OF 1972).

In order to consolidate her political positions, Nigeria government started to encourage individuals to establish industries mainly for import substitutions. Manufacturing firms were set –up by private individuals for production of goods and services such as food processing, agro-allied industry, chemical, pharmaceutical industry, based industry & petrochemical industry etc.

Owing to the government encouragement on indigenization programmes in 1972 more business were established (as mentioned above). Also because of the vital roles business play in the economy, more manufacturing / multinational companies were established so as to stimulate economic activities and as a means to develop the economy as a whole. Although, ever before the independence, most manufacturing sector that were operating in Nigerian economy were largely owned by foreigners and due to the indigenization programme that encouraged private owned businesses, Nigeria took interest in the operation and establishment.

Most of the business owners or manufacturers were profit conscious instead of the consumer protection.
In fact, almost everybody wants to make it fast, and become a millionaire overnight. This ambition is what made most manufacturers to be producing low standard products which are detrimental to the health of the general public. Most products are below standard and do not at times achieve the objectives of their production.

(Nnenna B. Ani, 1999: 9) Because of the values average Nigerians attached to money (wealth), no matter how the wealth is a acquired, they don’t care to know.

This is why people go into swindling (419) where they dupe unsuspected business men or innocent members of the public.

Instead of causing more harm to the Nigeria economy, they should have gone into goods and services productions in other to will improve on the economy. (Nnenna B. Ani, 1999:2) Thus conserving our dwindling foreign exchange earnings and generating employment opportunities for our school leavers and university graduates and earns some foreign exchange for the economy just as there was a tendency that manufacturing system / multinational companies will be of great help to the whole economy.

(Ojemba G. Agbo. 1999:67) They are a few things a developing country needs as much as multinational companies. These are few contributions from which it can benefit so much as from the multinational corporation can make. In the economy of developing or less developed countries in which Nigerian is one, the impact of Multinational Corporation may be described as follows;

Health, employment, education, creation of industries, skills development, social responsibility etc. So the companies like UAC foods plc, Gumess, smith Laline Beedan, M&B etc, have through these provisions really created a great development to our economy.

On the other hand, many harm have been done to the development of the Nigerian economy, there are loops holes on the total development. They have not been performing as expected. Sunrise floor mills and UAC foods Plc in Enugu state have not found to be different in the case of ignorance and mismanagement of resource.

Because of the damages caused by most business to the economy as a developing one, government therefore embark on regulation and control of business to enhance this level of productivity and also to make positive impact on the economy.

1.2 Statement of the Problem

The performance of business organization in Enugu State is major source of concern and worry to all well meaningful citizen of the state, even the state government Most of the business organization in Enugu State are equipped with numerous men, materials and other resources to manage.

Inspite of government regulation and control aimed at setting these businesses on a sound footing, the management of these business organizations have proved to be inefficient, ineffective and non-result oriented. Even the government owned industry performed woefully.

Looking intently at this statement, we can deduce that Nigeria is endowed with many natural resources, numerous to mention, inspite of the level of natural resources that Nigeria has, mismanagement, lack of direction and misappropriation among others are the factors that are militating against the development of the Nigeria economy.

The researcher will however go further to add other factors as government regulation and control imposed on these business organization which have proved to be impediment to the profitability of these business. These regulation and control include appointment to this business of unskilled/or untrained staff.

1.3 Purpose of the Study

The broad purpose of the research is to study government’s regulation and control of business in a developing economy.

The specific purposes are to find out,

  1. The reason why government regulates and controls business organization in a developing economy.
  2. The tools used by government for effective and efficient regulation and control.
  3. And how government regulates sunrise mills ltd and UAC foods plc.

1.4 Scope of the Study

The research topic spans over businesses in Nigeria developing economy, but the researcher cover only two business organizations in Enugu State, sunrise flour mills Ltd and UAC foods Plc.

Normally, the nature of the study requires a random drawn from a large population to validate the initial postulations that most of these business organizations in Nigeria perform below expectation.

The research does not ignore this important research requirement, but sees the concentration in Enugu State as not neglecting the validation of the generalization because it has become an accepted fact that most business organization perform badly, for this reasons, the researcher believes that what obtains in the rats village is also, obtainable in the rabbits village.

Therefore, our findings in these business organizations would be applicable to other business organizations in Nigeria economy.

1.5 Research Questions

  1. Does any factor constitutes the major projective of the business organization?
  2. What are the factors responsible for the poor performance of the business organization?
  3. Does the organization has performance rating?

1.6 Research Hypothesis

  1. Ho: Government regulation is contrary to the private objective of the business
    Hi: Government regulation is not contrary to the private objective of the business
  2. Ho: Yearly national budget affects business.
    Hi: Yearly national budget does not affects business.
  3. Ho: Government law affects the business operations adversely.
    Hi: Government law does not affects the business operations adversely.

1.7 Significance of the Study

It is worthy to note that today is a review of yesterday and the basis for future plans of action. That Nigeria economy is in stage of development today is an evidence that , the economy will develop and appreciate to the benefit of all.

This research study is therefore relevant first to various sectors of the economy. It is equally relevant to policy making bodies of government as tasks participation in some business in the economy as concerned.

It is hoped that this study will benefits top management of these business organizations’ whole operations, and providing a kind of check-up list for efficient business management for the academic and Nigeria society. The research study will serve the purpose of arising deeper and genuine interest on the subject matter for further research aimed at eliminating these terrible situations from our system. It is by deliberate action that the intention of this study is to contribute towards improving the quality of business administration and management in Nigeria and in the particular case in Enugu State.

1.8 Limitation of the Study

The actual limitation of the study was the differently and unwillingness of both the government agencies and the business organization being studies to release needed information records and some documents.

The documents, they said are not for public consumptions. Original reports and financial statements were not released, funding, inferences were based on aggregate (final) figure which are difficult to dismantle, for the purpose of time analysis and comparison.

Nevertheless, responses were got through personal interviews and questionnaires.

The researcher was also constrained by time factor. Though a research of this sort is combined with classroom work within a short time. However, these limitations were gotten over and the study conclusively carried out hundred percent error free. However, I hope the readers of this work would find it interesting and useful even though it may not meet their expectations.

1.9 Definition of Terms


This refers to the body of persons governing a state.


This refers to the prescribed rules, authoritative direction correct pattern used to moderate business activities in order to benefit both the government and the citizen of such nation.


This is an economic activity in production of goods and services for the satisfaction of mankind.

Chapter Five

Discussion, Recommendation and Conclusion

5.1 Discussion of Result / Findings

From all indications, it is important to note that the impact of government regulation and control on businesses in developing economy is not encouraging in all ramification thereby not really done much in the area of sound development.

Also, instability in government policy was discovered, which led to the various abandonment of many plans and programs scheduled to regulate and control the business organization.

Again, it was discovered that all systems of regulation and control of business in developing economy in uncoordinated etc.

5.2 Conclusion

Government regulation and control of business in developing economy examined in this research study brought to the line light, the factors that hinder the efficient and effective performance of the business organization that ought to be profit oriented, productivity and also to be contributing there own quota towards the improvement at the national economy.

Most of the business organizations in Nigeria are generally are popular for being innovative companied with the developed countries. There is too much regulation and control, which has gone to affect the business operation in Nigeria. The causes of poor performance of the business organization is not much in the operation of the business but over regulation which has impaired in a significant manner the achievement of these business organization.
Government should also keep focus by the way the it regulates business organization so as to help build up and sharpen the developing economy to meet up with other countries it the world because very soon Nigeria economy will be like other economy of the world.

5.3 Implication of the Research Findings

The findings of the researcher has some important implications for education. They should include such things as

  1. Ensuring that government consult the business organization before making policy on the regulation and control of the business.
  2. Ensuring that government keep focus on the way it regulates business organization so as to achieve measurable attainment.
  3. Ensuring that government priorities should not be changed frequently so as to enable the business organization to conform rightly with the stipulated policies.

5.4 Recommendations

From the findings made and according to Ozo (1999:227) recommendations should be specific, practicable, logical, well thought and backed up by theory or principles and practices in the profession or discipline involved.

  1. Every regulation and control should conform to the Nigeria system since Nigeria economy is undergoing development. This will enhance government effect to be well directed.
  2. Government should deregulate some business in the economy since Nigeria is growing to meet up with other nations of the words. This will enable many industries to invest in the Nigeria economy.
  3. Government should from time to time disseminate relevant information about regulation to the business organization in the economy. They should through the on up to data necessary, gather information that will keep them fit in running businesses.
  4. The government should imbibe the habit of maintenance culture. Thereby giving adequate to Preventive and corrective maintenance.
  5. Government priorities should not be changed frequently so as to enable the business organization to conform rightly with the stipulated policies

5.5 Suggestions for Further Research

The researcher is suggesting that further studies could be carried out in any of the followings:-

  1. A replication of this study in other organization
  2. The prospect of government regulation and control in developing economy.
  3. The stability in government policy and a way of ensuring organization conformity with stipulated policies.

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