Privatization Of Public Enterprises And The Working Class In Nigeria

Project and Seminar Material for Political Science

Abstract

This work is intended to explores privatization of public enterprises and its impact on the working class in Nigeria. It contends that privatization has negative implications on the labour force and on the poor in Nigeria. The Marxist political economy was adopted as the theoretical framework. Privatization of public enterprises is nothing but a political agenda of the capitalists and their ideologues. The data for this study were collected from the primary and secondary sources. With privatization, poverty and unemployment has increase, just as education and health care has become a luxury for the Nigeria masses. It recommends pro-poor reforms instead of this pathological fixation on privatization as the only solution to the country’s economic problems.

Chapter Five

Summary, Conclusion and Recommendation.

Summary

In this work, we discussed the impact of privatization of public enterprises on the working class in Nigeria, with the specific objectives to determine the relationship between privatization of public enterprises and unemployment in Nigeria; and to ascertain if privatization lead to further widening of the gap between the rich and the poor in Nigeria.

It is pertinent to say with regard to the Nigerian context that, the assumption that the developmental problems of a country is caused by the malfunctioning of the public sector and that privatization holds the magic for Nigeria’s development in unsupported by fact, and at best just an over simplification of a complex and fundamental problem. Privatization as a policy has cleverly glossed over fundamental issues, which underscores the development of underdevelopment in Nigeria. These Nigeria is to develop are, the process that informs the system; the monoculture and dependent nature of the Nigerian economy, coupled with the rentier character of the productive forces, and the asymmetrical relationship and exclusion inherent in the globalist political economy to which Nigeria is uncritically subjected to.

Following from the above, is the fact that Privatization as a development policy is thus a technists, reductionist and simplistic solution to a fundamental and developmental problem confronting an underdeveloped and dependent capitalist country like Nigeria. Privatization, in fact reinforces the very forces at the root of the problem of underdevelopment and maldevelopement by promoting the opportunities for capitalist accumulation for both foreign and domestic capitalist interests at the expense of national development and popular emancipation.

One major discovering was that privatization through clothed in elegant economic sophistry, is nothing but a political agenda of the capitalists and their ideologues. There are many non-economic and non-efficiency related reasons behind privatization. Economic and efficiency rationalization are but façade for privatization.

We have also tried to demonstrate that privatization evidenced increase power of the private sector actors, both local and foreign, while it decrease the power of the majority of the populace whose survival is concomitant to the existence of public sector supplied social services. Privatization as we argued is an inelegant and desperate solution to macro-economic problem and a lazy substitute for serious and profound economic engineering.

Given the associated desperation, privatization represents a quick-fix method. And like all desperate and unprogrammatic actions, privatization fails to address and goes over the fundamental issues at the root of the crises it attempt to solve, in this case the inelegant and explicitative structure of global capitalism.

This work also debunked the impression that public enterprises cannot be runned efficiently as empirically wrong. Private enterprises are not runned by owners/shareholders but hired managers, this separating ownership from control.

We adopted Marxist political economy as the theoretical framework which maintained that privatization is a capitalist ideology that will always bring about poverty and unemployment in the society. That privatization and commercialization is a new-liberal development strategy devised by the international financial institution to incorporate national economics into the global market. The primary reason behind this policy is to make available huge sums of money in the hands of the government to allow them to easily and conveniently service their huge debts.

The data for this study were collected from the primary and secondary sources.

Conclusion

In conclusion we infer that, with privatization, poverty and unemployment has increase, just as education and health care has become a luxury for the Nigerian masses. The Nigeria economy has continued to experience serious complications and underdevelopment with the pains and the agonies of the ordinary Nigerians increasing under the anti-people policy embarked on by the government in the name of economic reform, liberalization, deregulation and marketization. Privatization is not a blanket solution for the problem of poorly performing SOEs. It cannot in and of itself make up totally for lack of competitions, for weak capital markets, or for the absence of an appropriate regulation framework.

Finally, privatization of public enterprises in Nigeria inflict damage on the poor through lose of employment reduction in income reduction in basic social services and increase in price of goods and services. It is expected that privatization will increase job opportunity and general well-being of the people. Paradoxically the reverse seems to be the case in Nigeria; and the above concord with hypotheses that privatization of public enterprises lead to unemployment and further widening of the gap between the rich and the poor in Nigeria.

Recommendations

We, therefore advance that since Nigeria is a developing country like other countries in Africa should advocate for pro-poor reforms instead of this pathological fixation on privatization as the only solution to the country’s economic problems.

The first step should be for Nigerians to learn and study the implications of privatization for the economy, ordinary people and the future of the country. That future Nigeria government should use job creation as the main criterion to determine which projects will be slated for privatization. The government should start privatizing projects that have the highest potential for job creation, rather than projects that will generate the highest revenues. Job creation contributes to political stability and enhances Nigeria’s ability to move towards a democratic society.

Finally, if SOEs must be privatized, then privatization must be carried out in such a way as to absorb the workers in the establishments as joint owners of the business on equal terms with other Nigerians. Perhaps this will minimize unemployment galore that arise from the implementation of the policy.

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