Abstract
Public enterprises in Nigeria were established to propel socio-economic development and to guard against the control of the economy from foreign domination and exploitation. This accounts for why a larger proportion of the national budget has been voted for the creation and sustenance of public enterprises. Privatization plays key roles in restructuring economic and social attributes of developing countries. The performance of any economy in terms of growth rate and per capita income have always been based on and associated with active involvement and participation of the private sector. It is apt to note that public enterprises in Nigeria have failed to demonstrate strong desire and ability to promote economic growth perhaps due to ineptitude of the managers and inadequate clear-cut operational guidelines establishing such enterprises.
INTRODUCTION
Privatization is the transfer of ownership and control of enterprises from the state to the private sector. It is a system of economic and operational restructuring and reallocation of public assets from the public sector to the private sector. (Adnan 2005) asserts that the process is a fundamental economic ideology that promotes ingenuity that can lay claim to property right. Public enterprises were established to enhance Nigeria’s socio-economic development, especially, after independence in 1960. The major concern, in this regard, had been to accelerate development and economic selfreliance through “economic nationalism” (Odeh, 2011). A public enterprise has been defined as one that has a corporate identity, whose capital is wholly or substantially provided by a central or local government authority. The enterprise is accountable to the central or local government, which acts as trustee for the community. The enterprise will be engaged in the production and marketing of goods and services and designed to add wealth to the community (Powell, 1987). Put differently, public enterprises are rationally organized activities by the government (Central, State or Local) aimed at producing services and commodities to its citizenry. From the foregoing, we can deduce that public enterprises are owned and run by the government and geared towards the production of either consumer or producer goods or services. In this regard, institutions and organizations are set up by the government to produce and market goods and services to the generality of the people. Government fully owns, finances, manages and controls these institutions.
Aim and objectives
Privatization has become the new global economic reform policy in recent times perhaps due to its tendency for better contribution in raising the standard of living as an instrument of economic development. In this context therefore, this study is poised to present a general overview of privatization programme in Nigeria, the challenges and prospects on economic development of the country. In the 1999 privatization act, the following have been advanced as some of the major objectives of adopting the programme of privatization and commercialization:
- To send a clear message to the local and international community that a new transparent Nigeria is now open for business.
- To restructure and rationalize the ‘public sector to substantially reduce the dominance of unproductive government investments.
- To change the orientation of all public enterprises engaged in economic activities towards a new horizon of performance improvement, viability and overall efficiency.
- To raise funds for financing socially oriented programmes such as poverty eradication, health, education and infrastructure
- To ensure positive return on public sector investments in commercialized enterprises through more efficient private-sector oriented management.
