Privatization of Public Enterprises in Nigeria: Challenges and Prospects

Adekola Abdulazeez Alao, Raheem T. Kazeem

Abstract

Public enterprises are established as a direct intervention measure of government in economic affairs,
especially the need for rapid economic development. By 1980s, the quantum of resources required to
sustain the public enterprises had become an unbearable burden on the affected nations. An assessment
of government success or otherwise in business enterprises in Nigeria especially, makes it very apparent
that the business of governance should not be mixed with the running of purely business enterprises.
Thus, Privatization became the next option, as the best approach to economic transformation. By the
middle of 1980s, Nigeria started to privatize its Public Enterprises as part of the conditions of the
International Monetary Fund, IMF. Since then, privatization of Public Enterprises has been the priority
of various regimes and fully on ground in Nigeria. For this, the paper examines and analyses the
implementation of privatization of public enterprises in Nigeria. In the process, the paper discovers that
privatization of public enterprises is confronted with so many challenges, which include the following:
corruption, human capacity building, labour problem, disappointing subscription rate, inability of the
programme to attract foreign investors, under valuation of assets, undue interference from the political
class. These challenges confronted on the programme could not allow Nigeria reap the desired benefits.
Therefore, the paper concludes by providing policy alternatives to enable the programme achieve more
concrete benefits to Nigerians.