Nigerian Manufacturing Sector Research Articles

The Effect of Board Interest on the Dividend Policy of Nigerian Manufacturing Sector

This study investigated the effect of board interest (insider ownership) on dividend payout of the Nigerian manufacturing sector for the period of 2009 to 2015. The data for the study was generated from the annual report of five randomly selected firms from the manufacturing sector in Nigeria economy. The data for this study was analyzed using pooled panel least square model and the result revealed that board interest has a negative and insignificant impact on dividend payout of the firms under consideration. On the other hand the result of the correlation test shows that board interest has a negative relationship with dividend payout. The empirical result also indicates that ownership concentration has a positive but insignificant effect on dividend payout of the Nigerian manufacturing firms. Firm size was found to have a positive and significant effect on dividend payout among Nigerian manufacturing firms. The study suggested that firms in the sector should balance the use of both insider ownership and dividend pay as a tool for managing agency conflict which always result to increased agency cost provided that the choice of tool will not adversely affect the firm’s performance.

Determinants of Exchange Rate Sensitivity on the Nigerian Manufacturing Sector

This paper examines the exchange rate sensitivity and its determinants with special focus on the Nigerian Manufacturing Sector (1980-2014). The motivation for this study is driven by the exposure of Nigeria’s exchange rate and economy excessively to external shocks as revealed by the effects of the recent global economic crisis on Nigeria. In doing this, Error Correction Model (ECM), Augmented Dickey-Fuller (ADF) testand the Johansen co-integration technique were adopted to examine the impact of exchange rate fluctuations on Nigeria’s manufacturing sector. The variables employed include: Average Official Exchange Rate of Naira vis-a-vis US Dollar and Nominal Effective Exchange Rate Indices, interest rate, inflation rate, Balance of Payment (BOP), real Gross Domestic Product (GDP), manufacturing index of ordinary shares listed on the Nigerian Stock Exchange, and average manufacturing capacity utilisation rates. The result of the empirical analyses showed that the Nigerian manufacturing sector is not sensitive to exchange rate fluctuations in the long-run. Also, it was found that interest rate and Gross Domestic Product are the main determinants of exchange rates in Nigeria but interest rateis insignificant in the determination of exchange rate in the country. Some of the recommendations made in this study are that: the monetary authorities should maintain stability of the exchange rates through proper management so as to encourage local production, the monetary authorities must endeavour to force the interest rate down and continue to advocate for priority lending to the manufacturing firms. Equally, the government must continue to discourage importation in order to maintain exchange rate stability.

Micro-level determinants of innovation: analysis of the Nigerian manufacturing sector

This paper uses the binary logistic regression to test two hypotheses among manufacturing firms in Nigeria. First, the influence of firms’ innovation activities on the propensity to implement innovations and second, whether size influences the type of innovation implemented by firms. Using the data from the Nigerian Innovation Survey 2008, the results show that intramural R&D influences firms’ likelihood of implementing all the four innovation types being statistically significant at 0.05 level. In addition, investment in machinery and equipment specifically increases firms’ likelihood of introducing product innovation. Similarly, market introduction of innovations impacts on marketing innovation. The binary regression result however shows that the size of manufacturing firms in Nigeria does not significantly influence the introduction of any type of innovation.

The Infant Manufacturing Industry Argument on Tariff: the Nigeria Hypothetical Example

This study was set to establish the fact that infant industries argument in favour of Nigerian manufacturing sector still holds. This is owing to its strategic importance in promoting the nation's economic growth. This study employed OLS method to analyse the secondary data obtained from Central Bank of Nigeria statistical bulletin from 1988-2010. The Regression result shows that tariff impacts positively on the growth of manufacturing sector while, inflation, interest rate and import impact negatively. Specifically, the analyses revealed that inefficiency in the manufacturing sector is mostly caused by high interest rate. Since tariff and import are insignificant determinants; Nigerian manufacturing sector can thrive in the presence of foreign competition if government can address more significant issues. It is on this note that we recommend a shift in attention to the provision of sound and effective economic policies as well as good management of the monetary sector as a way out of persistently high interest and inflationary rate problem. Improvement in the provision of physical infrastructure notably in the area of power supply will also be thought geared towards the right direction

AWARENESS, APPRECIATION AND FAMILIARITY WITH OPERATIONS RESEARCH AMONG MANAGERS IN QUOTED MANUFACTURING FIRMS IN NIGERIA

Unconscious or informal application and failure to acknowledge the use of operations research (OR) approach by corporate managers has been going on globally for a very long time. This largely accounts for the inability of scholars to make accurate assessment of the level of application of operations research in the non-academic environment. It is therefore evident that asking an operations manager whether OR models or methodology is applied by his company may likely not produce a response that truly represents reality as some may be unknowingly making such applications. This study therefore examined the level of awareness of OR among corporations in the Nigerian manufacturing sector. It also assessed the extent of familiarity with OR models among managers in the manufacturing sector and their appreciation of OR techniques as a viable business decision-making tool. Consequently, steps that constitute the decision-making procedure of firms in the manufacturing industry of Nigerian economy were examined to determine the extent to which OR methodology or philosophy may have been incorporated.

English

This study empirically investigated the impact of globalization on economic security, with a reflection of the performance of the Nigerian manufacturing sector, using co-integration and error correction mechanism (ECM) techniques with annual time series covering the period between 1981 and 2010. The findings revealed that globalization has negative impact on the performance of the Nigerian manufacturing sector in the long run but positive effects in the short run. Therefore, it is recommended that since Nigeria cannot cease from participating in the globalization exercise, the Government and other policymakers should adopt a proactive and appropriate policy mix in economic, fiscal, monetary, political, institutional and risk management frameworks, in order to harness and maximize gains of globalization while minimizing the uncertainty shocks to the Nigerian economy. Key words: Globalization, economic security, co-integration and error correction model (ECM).

Survey of corporate social responsibility practices in Nigerian manufacturing sector

Based on stakeholders’ theory, this study examined the practice of corporate social responsibility by manufacturing companies in Nigeria. It employed survey research design to study 15 randomly selected companies in the food and beverages sector. A total of 225 questionnaires were administered to collect data. Data analysis revealed that CSR is a familiar concept in the sector as most of the companies do engage in CSR activities regularly. The major areas of focus of the CSR activities include Education and Youth Development/Sport, among others. However, the study revealed that the proportion of Turnover invested in CSR is negligible. The hypothesis tested also corroborated this fact as the result of the test indicated no significant relationship between turnover and CSR investments. The major recommendation is that Nigerian manufacturing organizations should review their CSR policies to ensure that they are not just socially responsible, but to be seen so by the public.

The Effect of Foreign Direct Investment on the Nigerian Manufacturing Sector

This study examined the effect of Foreign Direct Investment (FDI) on the Nigerian manufacturing sector spanning 1975 – 2008. Nigeria has embarked on several policy measures aimed at enhancing the manufacturing sector’s productivity coupled with the inflow of FDI to the country. The controversy is that the policy makers are not convinced that the potential benefits of FDI could be fully realized. The methodology adopted for the study is the Vector Auto Regression (VAR), co-integration and error correction techniques to establish the relationship between FDI and the growth of manufacturing sector. The findings from the study show that FDI has a negative effect on the manufacturing productivity and is statistically significant. Arising from the findings, it is recommended that government should create an enabling environment for foreign investment and the monitoring of FDI benefits, with particular focus of NEPAD and NEEDS through the instrumentality of the MDGs; thereby mustering the capacity for sustainable growth in the manufacturing sector. Key words : FDI; Manufacturing sector; Productivity; Growth, Policy

Factors Affecting Capacity Utilization Decisions in Nigeria: A Time Series Analysis

This study examined the impact of some macroeconomic variables and power supply on the performance of the Nigerian manufacturing sector, using ex-post facto research design. Secondary data were sourced from Central Bank of Nigeria (CBN) statistical bulletin (2009) and other publications. The main findings of the study were that power supply had positive and significant impact on capacity utilization while inflation rate and interest rate had negative impact on capacity utilization. However, the impact of interest rate was significant at 5% level while lending rate was insignificant. Time series data were analysed with the aid of e-views 5.0 econometric computer package using least square multiple regression technique. The regression model explained 88.54% of the variation in capacity utilization, after correcting for linearity, normality, auto-correlation and heteroscedascity. The study recommended that the ongoing privatisation of Power Holding Company of Nigeria should be pursued with vigour and that the policy thrust of single digit inflation and lending rates by CBN should be sustained. The government should also put in place monetary and fiscal policies to create an enabling environment for the manufacturing sector, thereby giving a boost to the economy as a whole.

Scenario Planning as a Recipe for Corporate Performance: The Nigerian Manufacturing Sector Experience

As organisations struggle to deal with an increasingly uncertain world, they are looking to their managers to findways in helping them to prepare for possible futures. Many organisations now apply scenario planning methodsas means of evaluating their effectiveness and performance under different sets of assumptions about the future.This study investigates the relationship between scenario planning and corporate performance in themanufacturing sector in Nigeria. A survey research method was used to generate data from a sample ofmanufacturing firms in Nigeria on scenario planning and corporate performance variables. Responses from thesurvey were statistically analyzed using descriptive statistics, product moment correlation, regression analysis andZ-test (approximated with the independent sample t-test). The results of the study indicate a statistical significantrelationship between scenario planning and corporate performance as well as reveal a significant differencebetween the performance of firms whose scenario planning are low and the performance of firms whose scenarioplanning are high. The research findings provide insights regarding how the interaction between scenarioplanning and corporate performance would assist the growth and development of the manufacturing sector inNigeria.

Strategic Human Resource Management and Organizational Performance in the Nigerian Manufacturing Sector: An Empirical Investigation

Despite the relatively large bulk of literature on strategic HRM, there is still an ongoing debate as to whether itexists in reality or is merely rhetoric. This paper attempted to broaden the scope of existing literature by examiningthe extent to which Strategic HRM is practiced in the Nigerian manufacturing sector as well as its impact onorganizational performance. A multi-respondent survey of 21 Nigerian manufacturing companies was undertakenand data collected was subjected to correlation and regression analysis as well descriptive statistics in pursuance ofthe stated objective of finding a fit between organizational performance and strategic human resource managementpractices. Results show that strategic HRM was moderately practiced by the companies operating in the Nigerianmanufacturing sector. Results also indicate that line management devolvement, innovative recruitment andselection system, regular training and development of personnel, equity based compensation system, performanceappraisal system, effective career planning system and a robust employee participation in the organizations’decisions and actions are the key strategic HR practices that influence organizational performance in the Nigerianmanufacturing sector. It therefore, implies that companies operating in the Nigerian manufacturing sector shouldpay more attention to these practices with a view to improving their implementation across the industry.

The effect of exchange rate fluctuations on the Nigerian manufacturing sector

This paper examines the impact of exchange rate fluctuations on the Nigerian manufacturing sector during a twenty (20) year period (1986 – 2005). The argument is that fluctuations in exchange rate adversely affect output of the manufacturing sector. This is because Nigerian manufacturing is highly dependent on import of inputs and capital goods. These are paid for in foreign exchange whose rate of exchange is unstable. Thus, this apparent fluctuation is bound to adversely affect activities in the sector that is dependent on external sources for its productive inputs. The methodology adopted for the study is empirical. The econometric tool of regression was used for the analysis. In the model that was used, manufacturing output employment rate and foreign private investment were used as the explanatory variables. The result of the regression analysis shows that coefficients of the variables carried both positive and negative signs. The study actually shows adverse effect and is all statistically significant in the final analysis. Some recommendations for policy were made based on the findings. Amongst others is the need to strengthen the link between agriculture and the manufacturing sector through local sourcing of raw materials thereby reducing the reliance of the sector on import of inputs to a reasonable level. Key words: Nigeria manufacturing sector, exchange rate, fluctuations.

Literature review of past and present performance of the Nigerian manufacturing sector

This paper attempts to examine the past and present performance of the Nigerian manufacturing sector. The major problems and limitations that impede the growth of the sector are analysed. In the 1960s and 1970s after the country's independence, the Nigerian manufacturing sector had been developing positively as a result of direct foreign investment. Foreign companies had introduced new manufacturing technology that saved time and cost, and improved the quality of the products manufactured. However, despite this initial flourishing growth phase, the sector was not able successfully to meet local demand and the costs to the country for imported manufactured goods were high. From the end of 1980s to date, many problems were found that were responsible for low growth and development in the manufacturing sector. Some of these problems were dependency on oil for income, weak infrastructure, shortage of skilled labour, lack of adequate financial resources, lack of proper management and planning, and so on. The paper concludes that it is essential to work towards resolving all of these problems in order to rejuvenate the Nigerian manufacturing establishments so that the manufacturing sector can play an important role in the country's economic development.

Globalization and the Manufacturing Sector: A Study of Selected Textile Firms in Nigeria

This study examined the impact of globalization on the Nigerian manufacturing sector with focus on selected textile firms from Lagos, Asaba and Kano.The data were collected using both qualitative and quantitative methodologies. The former were collected through interviews while the latter were collected via structured questionnaire and documents. In all, 630 respondents were used for the study. The respondents were selected using multiple sampling techniques - comprising of (i) stratified random sampling (ii) quota sampling, and (iii) systematic sampling techniques. The data were analyzed using parametric and non-parametric statistics.The main finding of the study is that globalization had strong adverse effects on capacity utilization in the manufacturing sector. And that the problems associated with globalization and liberalization of trade hindered economic growth and sustainable development. The study concluded on the note that Nigeria needs to have a second thought on globalization and her membership of the WTO agreement if she does not intend to do away with the manufacturing sector of the economy.

Electric infrastructure failures in Nigeria: a survey-based analysis of the costs and adjustment responses

This paper examines the cost of electricity shortages on the Nigerian manufacturing sector. Utilizing the data obtained from a 1998 nationwide survey, the paper details the various costs from power outages and examines the response of manufacturers to the infrastructure problem. The findings of the study confirm that the cost of electricity failures on the Nigerian manufacturing sector is quite high. Firms incur huge costs on the provision of expensive back-up to minimise the expected outage costs. The average costs of this back-up are on the average 3 times the cost of publicly supplied electricity. The marginal cost estimates also indicate that the cost of kWh of unserved electricity in Nigeria is very high. Small-scale firms bear the greater proportion of the cost of the power failure. A situation where firms spend as much as 20–30% of initial investment on the acquisition of facilities to enhance electricity supply reliability has a significant negative impact on costs competitiveness of the manufacturing sector. Thus, the study supports current government efforts to privatise the public monopoly and liberalizes the electricity market. These hopefully will mitigate the burden of poor power supply as well as introduce the needed competition into the electricity market in the country.

Energy use and productivity performance in the Nigerian manufacturing sector (1970‐90)

This paper investigates the relationship between productivity performance and energy consumption in the Nigerian manufacturing sector at both aggregated and disaggregated levels.It adopts a non‐parametric approach to the measurement of total factor productivity (TFP). It then specifies a regression model linking the estimated TFP growth with changes in energy use. The objective is to examine the impact of energy‐pricing policy on efficiency in the manufacturing sector.The paper establishes that energy consumption still plays a critical role in productivity growth in the Nigerian manufacturing sector. However, the recent price reforms in the energy sector can only achieve meaningful results if accompanied by technological reforms in the manufacturing sector. The industrial sector is still dominated by old energy‐inefficient technology.However, there are prospects for enhancing energy efficiency in the long run. When prices are allowed to signal the real cost of an input, producers would not only become efficient in energy use, but would also be able to select appropriate input combinationsthat minimised their costs of production. Long‐term investment would also be committed to energy‐saving equipment.Furthermore, the development of the gas sub‐sector may also provide an alternative source of energy to many firms.

98/03479 Productivity growth and energy consumption in the Nigerian manufacturing sector: a panel data analysis: Adenikinju, A. F. Energy Policy, 1998, 26, (3), 199–205

98/03479 Productivity growth and energy consumption in the Nigerian manufacturing sector: a panel data analysis: Adenikinju, A. F. Energy Policy, 1998, 26, (3), 199–205

Productivity growth and energy consumption in the Nigerian manufacturing sector: a panel data analysis

This paper examines the impact of efficiency in energy consumption on the growth in productivity in the Nigerian manufacturing sector. The study utilizes a panel data technique covering a period of substantial energy price reviews in Nigeria. The study shows that, for most industries, productivity growth has been energy using, whereas, in a few, attempts have been made to switch productivity growth towards energy saving. However, it will take some time for the effect of current energy pricing policy to permeate the whole manufacturing sector due to the high cost required to invest in energy saving equipment, especially in the face of a rapid decline in real income coupled with high product prices.