The Linkages of the Manufacturing Sector with Other Sectors of Nigerian Economy

Abstract

This paper examines the linkage between the manufacturing sector and other sectors of the Nigerian economy using Rasmussen method with the help of the Leontief inverse matrix. The National Bureau of Statistics (NBS) and the CBN Statistical Bulletin for 2011 provided the input-output transaction table of all sectors, which served as the source of data for the study. The constructed input-output (I-O) table gives a simple and logical arrangement of all economic activity within an economy. The result of this study shows that the manufacturing sector has a strong forward and backward linkage with other sectors of the Nigerian economy.The findings suggest that the Nigerian government should prioritize policies that promote growth in the manufacturing sector, as it will improve better living standard for all individuals in the sector and all others connected to the manufacturing sector. This can be done by providing tax breaks and other incentives to manufacturing firms, and by investing in infrastructure and education. The government should also focus on developing policies that promote the development of industries that produce intermediate goods and services, as these industries are important for the growth of the manufacturing sector as a whole also the manufacturing enterprises should be encouraged to employ domestic inputs.