Assessing the divergence of south-south Nigerian indigenous contractors in international construction environment for national economic recovery

Abstract

The expansion from the domestic market to the international market has become increasingly important for construction business including that of Nigerian Contractors amidst saturated local market, more patronage to foreign Contractors by the sector, stiff competition, political rivalry, insecurity and dwindling economic situation in the country. These factors have left most Contractors vulnerable for years without contract awards thereby resulting in retrenchments, inability to remit value-added tax (VAT), unsustained company’s profitability, heavy financial risk, practice and technology drain, bankruptcy, merging of companies as well as redundancy. Thus, the aim of the paper is to evaluate sound prospects for economic boost by the involvement of indigenous Contractors in oversea’s projects. The research was built on the foundation of stage growth theory which postulated that countries should modernize and model themselves after wealthier and economical viable ones to climb the upward ladder for development. The paper adopted a survey design method in which a total of 150 questionnaires were administered representing the sample size and 120 copies filled and submitted completely was achieved through a simple random sampling technique from the target population of 240 Federal Government-registered Indigenous Contractors in the South-South geo-political zone of Nigeria. Data analysis was done through simple percentages, frequencies, mean as well as statistics tools-analysis of variance (one-way ANOVA) to test the effect of one variable on another. The results showed that high profit and revenue, expansion of subsidiaries, foreign direct investment (FDI), new technological strength, the local and foreign government supports, amongst others were ranked 1st, 2nd, 3rd, 4th and 5th respectively as key prospects that will be achieved for the economic recovery of the nation. Also, competing in a foreign contract will lower the cost of the project in the country. The paper tested a hypothesis: whether there is value addition on the nation economy via indigenous contractor participation in the foreign project. The alternative hypothesis H1 was accepted since the f-calculated value of 64.24 was greater than the table f-value of 5.29 at 4/20 degree of freedom tested at 0.01 level of significance. It then concluded that Indigenous contractors has not been involved significantly in the overseas project, hence; it recommended an integrated approach, developing external wings, good industry practices, technical and dynamic capabilities, collective championing and depoliticizing construction contract for maximum participation.