Privatization of Public Enterprises in Nigeria: Critical Success Factors

Abstract

The persistent quest for social-economic development across the nations of the world occasioned the establishment of public enterprises and subsequent privatization policies/programmes. Countries of Africa, especially Nigeria, established large scale public enterprises with the intention of engendering and pursuing social equity among the populace.  Regrettably however, the public hope and expectations from public enterprises were dashed as the operations of these public enterprises were brazenly characterized with inefficiency, massive corruption, ineptitude, nepotism and gross mismanagement leading  to, not only the collapse of public enterprises, but also to a paradigmatic change of approach to national socio-economic development. Consequently, privatization policy was introduced with the promulgation of Decree No. 25 of 1988 by the then Federal Military Government of Nigeria. The issue of privatization, till date, has remained controversial as it has generated (and it is still generating) a seemingly endless debate among Nigerians. Regardless of the ongoing debate and controversy, government has forged ahead in its privatization exercise. It is against this backdrop that this paper examined the privatization of public enterprises for national development. The paper also traced the evolution of public enterprises, its justification and consequential failure. Furthermore, the paper explored privatization in Nigeria, its implications on economic growth and development as well as the critical success factors of privatization. The paper concluded that privatization of public enterprises is good for our national development if the critical success factors like putting in place proper and implementable regulatory framework, adequate public education, taking cognizance of the interest of the poor, effective monitoring and evaluation, transparency, and accountability (among others) are implemented. Thereafter, the economic objective of harnessing and distributing material resources of the nation to serve the common good (as stated in Section 16, sub-section 2(b) of the Constitution of the Federal Republic of Nigeria 1999) would have been achieved.

Keywords: Public Enterprises, Privatization, Socio-Economic Development, Policies/ Programs, Corruption, Transparency and Accountability