Since the arrival of this millennium, entrepreneurship has been prescribed as the main cure of poverty in Nigeria.[1] Following advices from foreign ‘experts’,[2] different regimes preach and fund few Nigerians to pursue entrepreneurship. Also, several foreign aid packages and fellowships for Africans attach entrepreneurship as a major condition for sponsorship. They insist that entrepreneurship developed the West and other parts of the world, and can also develop Africa. This emphasis on entrepreneurship rouses an interest for understanding the concept, context, stages and effects of entrepreneurship, especially in Nigeria.
What is entrepreneurship?
Entrepreneurship is the process of “making money by starting or running businesses, especially when this involves financial risks.”[3] It involves efforts from individuals who invest resources to produce, modify, buy, sell or supply goods and services for money.[4] Entrepreneurial stages are grouped into primary (mining/harvesting raw-materials), secondary (industrially transforming raw-materials into finished goods) and tertiary (distributing to users).[5] The primary stage provides the raw-materials, the secondary stage requires specialized skills to convert raw-materials into useful items to yield larger income and the tertiary stage stores, displays, supplies and applies the products to mid or end users.
Progressive societies develop socio-political systems for organic entrepreneurship that enable smooth transition between the primary, secondary and tertiary stages of entrepreneurship. Hence, the miners and farmers easily supply raw-materials to engineers who technically refine and package the products for distributors. Even when a progressive society lacks sufficient raw-materials to refine, they source for raw-materials from other societies. All developed and high-earning nations like Japan and USA have organic entrepreneurship systems connecting the primary, secondary and tertiary production.
Human needs and the rise of modern entrepreneurship in the West
People form societies to collaborate in owning and managing their resources for their needs.[6] Before the industrial revolution in 1765, most production activities were done by manual labour, which often involved slave-labour from conquests.[7] After the industrial revolution in Europe, industrial machines replaced slave labour in production; and steam/oil/gas energy replaced muscle-power. The efficiency of industrial machines in processing larger volumes of resources drove Europeans to seek more raw-materials for increased production.[8] Also, the increase in products required consumers who would steadily demand and exchange the finished goods for other desirable items.
Forming the socio-political order against Nigeria/Africa’s organic entrepreneurship
In search of raw-materials for running their factories and steady markets for surplus production, many Europeans moved down to Africa. Their objectives were clear: establish colonial systems for getting cheap raw-materials and making Africans to depend on European goods. To achieve these, Europeans killed the Africans who resisted their invasion,[9] and appointed loyal indigenes to rule the conquered territories.[10][11] Without regarding the cultural, religious and political differences between the different peoples, Europeans imposed national boundaries on the unconsented people.[12] And before leaving at independence, they trained and armed the indigenous loyalists to seize and export the unconsented people’s raw-materials to Europe in exchange for foreign goods and services.[13]
To mimic democracy, Nigeria’s colonially-imposed government created states, local governments and ministries to share imported goods and services as infrastructure and salaries for civil servants and politicians. Yet, despite the arbitrary creation of constituencies, districts and states, Nigerians have never agreed on being Nigerian.[14] Instead, the imposed government relies on military force to obtain cooperation for whatever idea or policy they want.[15] Presently, the most lucrative industry in Nigeria is public administration,[16] which confiscates and auctions people’s resources[17][18][19] and sparsely shares foreign goods. And without local productivity, the infrastructural costs and salaries for politicians and civil servants quickly flow back to industrialized nations as payment for foreign products.
Effects of the poisoned socio-political system in Nigeria
Presently, the different people who are held under the British-made political order cannot access their raw materials for production. And without access to mineral resources for industry, they cannot build steel-industries nor produce the tools and items they need. The social effects include unproductivity, unemployment, poverty, crime, corruption and dependence on foreign products. The dependence of about 200million Nigerians on foreign products outweighs the country’s capacity to pay with cheaply auctioned raw-materials. Also, the countries supplying these goods and services impose high taxes and duties on exported goods, thus increasing the costs. The result is that Nigeria and other African countries continuously incur huge debts by overdependence on foreign goods and services.
Situation of entrepreneurship in Nigeria today: INORGANIC ENTREPRENEURSHIP
The government’s confiscation of people’s resources for export removes the primary and secondary stages of entrepreneurship from Nigeria. Now, Nigerian entrepreneurship is reduced to searching for foreign products or services to sell, modify or use to provide services. Those who get funds through government contracts, loans or crime quickly market foreign products and services. The government-assisted entrepreneurs easily get tax-waivers, contracts and reduced forex rates to enjoy monopoly, while the others are multi-taxed till they go bankrupt.
“In the colonial society, education is such that it serves the colonialist… In a regime of slavery, education was but one institution for forming slaves.”[20] Presently, Nigerian education teaches how to count, use, prescribe and use foreign goods and services without producing theirs.
The overhyped emphasis on entrepreneurship in a disorganized political climate leads to an increase in the number of premature/unsustainable business ventures. And desiring the “CEO-title” in a society that lacks stable primary and secondary production system leads to frustration. Presently, Nigerian youths race towards self-employment by competing among themselves to market foreign products or export raw-materials. They are not inspired to collaborate in using their natural resources for all-round technological production and shared profits.
Efforts to lessen poverty as a product of inorganic entrepreneurship in Nigeria
Observing the deepening poverty in Nigeria and the growing debt, several international experts move to intervene.[21] The first step in any intervention involves identifying the root-cause of the problem, in order to provide effective solutions. The international ‘intervention’ experts made various efforts to identify the root-cause(s) of poverty and indebtedness in Nigeria, which include:
- Blaming the victim: international fallacies of false cause and generalization
Several foreign ‘experts’ describe Nigerians as lazy, greedy and “fantastic-corrupt” people, whose corruption chokes any possibility of growth. They insist that Nigerians lack fiscal discipline[22] and are intellectually unable to understand the process of technological production. Chinua Achebe recounts the Western intention for Africa’s economy saying: “We were told that technologically we would have to rely for a long, long time on the British and the West for everything.”[23]
These accusations appear fallacious because:
First, some Nigerians seem confused about the imposed social structure, thus engaging in corrupt practices for survival. Yet, that is not the cause, but an effect of the colonially-deformed political structure imposed on unconsented peoples. Referring to a brutally-merged and militarily-confined people as a democratic entity is a generalization fallacy of international proportions.
Second, the claim that Nigerians are lazy represents another fallacy of historical degree. Before colonialism, many Igbo and Yoruba communities had great blacksmiths and farmers, Borno people had crafts, hides and skin, Oyo Empire was massive in agriculture, Benin kingdom had a properly ordered city with high walls, and so with many other peoples that have been emasculated in the imposed colonial order. Though they did not have modern technology for advanced productivity, they were and are still eager to learn.
Third, claiming that Nigerians are unintelligent and incapable of technological productivity under an organic political structure contradicts history. As early as the 1960s, “European oil companies insisted that oil-industry technology was so complex that we would never ever in the next 500years be able to figure it out.”[24] But within two years of the civil war, the defunct Biafran Research and Development unit refined petrol, developed rockets, bombs and telecommunications gadgets.[25] Apart from Nigerians’ success in diaspora, a visit to Umuahia war-museum shows their intellectual capacity as at 1967. Those productive efforts would have advanced better if not for the choking political structure imposed and sustained on unconsented peoples.
- Blaming insufficient savings and capital investment
Foreign economic experts like Harrod R.F. and Domar E.D. insisted that national economic growth depends on the rate of savings and capital invested.[26] Thus, foreign experts and IMF officials, who brought Structural-Adjustment-Programs (SAP) said Nigeria was not raising enough capital for economic growth. Capital is defined as “a large amount of money that is invested or is used to start a business.”[27] But for post-colonial Africa, capital means having sufficient receipts (cash) as evidence for sending crude resources to industrialized nations. These receipts (cash) from bringing crude resources and the promise to bring more (debts) are what qualify Africans for obtaining foreign goods and services.
Wealth is created by applying scientific intelligence on crude resources like farm products and mineral resources from mining[28] before distribution. Thus, the contradiction in Africa’s “raising-capital-to-remove-poverty” is that getting capital implies removing the raw-materials for creating wealth. It is like trying to free a farmer from poverty by cheaply collecting his farm-products in exchange for few expensive meals. Hence, there may never be sufficient capital from this form of trade and political structure to free Nigeria from poverty.
- Blaming insufficient demands and spending
Keynes J.M. suggests that economic growth comes from having sufficient demands and spending for goods and services in a society.[29] He opines that an increase in demands for goods and services motivates business owners to invest more to earn more. This theory provides an excuse for Nigerian government to spend frivolously on inflated and nonpriority projects like stadiums and malls. However, since there is no local productivity, the money spent by government quickly goes back to the industrialized societies.
Demands can be divided between viable and nonviable demands based on the demander’s ability to pay for the demands. There is a high demand of goods and services from millions of hungry, sick, homeless and uncomfortable Nigerians. Regrettably, by confiscating the people’s production resources, the imposed social-structure restricts the cash-flow (pay-ability) to top civil servants, politicians and business allies. Thus, the demand for goods and services by the masses becomes nonviable, since they cannot pay for it.
Insisting on the superficial entrepreneurship despite its inefficiency after 50years suggests that these ‘experts’ are either impractical. Comparing global spread of entrepreneurship, International Labour Organisation (ILO) observed that richer countries have more multi-shared corporations than self-employment drive. Self-employment dispersion was 9percent in USA and UK, 25percent in Singapore, Taiwan, Korea and Malaysia and above 50percent in Africa.[30] The experts’ idea of entrepreneurship for Africa is like circulating water through pipes in a building without generating water. It resembles borrowing to install pipes for distributing insufficient and costly water from distant neighbours. In this case, economic growth can come from being able to generate your own water for the distribution within your house.
Adjusting the system of political instability for organic entrepreneurship
Entrepreneurship can be a noble force for multiplying and distributing wealth to different parts of a society and also Nigeria. However, without reorganizing the society for collaborative productivity, the overhyped entrepreneurship may not save Nigeria/Africa from poverty and hunger. Hence, Nigeria and other African societies who wish to free themselves from poverty may take the following steps:
- Conducting a social research to determine and recognise the different colonially-bound peoples and their respective lands and resources.[31]
- Organizing intercommunal conferences within sections and groups towards a national conference for the different peoples to agree on their partnership style. Thus, constitutional decisions and laws will reflect the people’s beliefs and agreement for a better partnership and technologically productive collaboration.
- Inviting willing local (and foreign) specialists to train the people to process their local resources for further industrial production. Hence, each section of the society will work to specialise in producing more of whatever natural resources they have.
- Releasing the people’s resources for industrial productivity and eventual tax to the central government. This will motivate the government to encourage and protect people’s productivity for better tax-returns. A productive people with active industries will generate enough raw and semi-processed materials for entrepreneurs to refine and distribute. They will also be able to afford the goods and services to be provided by the entrepreneurs as viable demands.
Encouraging proper entrepreneurship
- Creating opportunities for people with viable ideas to obtain easy loans to gather labour and raw-materials from local producers for their businesses.
- Fortifying agencies to regulate the different stages of production for optimizing standard of goods and service-delivery among entrepreneurs. This includes websites and apps for local producers and entrepreneurs to register their supplies and industrial demands respectively.
- Using indigenous construction entrepreneurs to create and maintain[32] routes and means of distribution for local goods and services.
- Encouraging collaboration between several entrepreneurs for better output and encouraging Nigerians to patronize their entrepreneurs.
If properly fixed, entrepreneurship has a capacity of spreading wealth and opportunities in a society, even in Africa. It simply has to spring from the people’s collaborative productivity and harmonized initiatives, instead of trickling down as government subsidy or foreign aids. Otherwise, it remains a distraction from productivity, favouring foreign producers, whose goods and services are marketed by local entrepreneurs. In the development of an organic society, production for local sustenance precede and support production for trade. Healthy entrepreneurship depends and progresses from a people’s technological productivity, not imported goods and services.
[1] Francis Ogbimi, Solution to mass unemployment in Nigeria (Ile-Ife: OAU press, 2007) p.9
[2] Francis Ogbimi, op. cit. p.10
[3] Oxford Advanced Learner’s Dictionary, International Student’s Edition. S. V. Entrepreneur.
[4] Ibid. S.V Business
[5] For intellectual resources, the primary stage is research/thinking, secondary is organization of discoveries for use and tertiary is publication or presentation.
[6] Aristotle, Politics, Bk 1
[7] J Oladele Fadeiye, Essays on modern world history (Lagos: Murfat publications, 2009), p.80.
[8] Cf. Oladele Fadeiye, European conquest and African resistance (Lagos: Murfat publications, 2011), p.29
[9] S. O. Oyedele, “Federalism in Nigeria” in Issues contemporary political economy of Nigeria (edited) Hassan A. Saliu, op.cit, p.57
[10] Walter Rodney, How Europe underdeveloped Africa, 2009 edition (Abuja: Panaf publishing Inc. 2009), p.273
[11] C. C. Dibie, Essential Government (Lagos: Tonad Publishers, 2012), p.137
[12] cf. Richard Dowden, Africa altered states, ordinary miracles. (New York: Public Affairs, 2010). p.3-4
[13] Walter Rodney, op. cit. p.319.
[14] Richard Dowden, p.445
[15] Olusegun Oladipo, “The need for a social philosophy in Nigeria”, convocation lecture in Ambrose Ali University, Ekpoma, Nigeria. May 8th, 2008. P.14
[16] Cf. Walter Rodney, op. cit. p.22
[17] Nigerian minerals and mining act 2007 act no. 20, chapter 1, Part 1, Section 1, paragraph 2 “… all lands in which minerals have been found in Nigeria and any area covered by its territorial waters or constituency and the Exclusive Economic Zone shall, from the commencement of this Act be acquired by the Government of the Federation…” “No person shall search for or exploit mineral resources in Nigeria or divert or impound any water for the purpose of mining except as provided in this Act.” “The property in mineral resources shall pass from the Government to the person by whom the mineral resources are lawfully won, upon their recovery in accordance with this Act.”
[18] Nigerian minerals and mining act 2007 act no. 20, chapter 1, Part 1, Section 2, paragraph 1
[19] Nigerian minerals and mining act 2007 act no. 20, chapter 1, Part 1, Section 1, paragraph 3
[20] FRELIMO (Mozambique Liberation Front) Department of Education and Culture 1968, quoted in Walter Rodney, op. cit. p.246
[21] Francis E Ogbimi, op. cit. p.10
[22] International Labour Organization, reported in Solution to mass unemployment in Nigeria by Francis Ogbimi, op. cit. p.10
[23] Chinua Achebe, There was a country (USA: Penguin books, 2012), p.157
[24] Chinua Achebe, op. cit. p.157
[25] Chinua Achebe, op. cit. p.156
[26] Francis Ogbimi, op. cit. p.16
[27] Oxford Advanced Learner’s Dictionary, op. cit. S.V. Capital
[28] Walter Rodney, op. cit. p.23
[29] Francis Ogbimi, op. cit. p.13
[30] International Labour Organization, referenced in “Solution to mass unemployment in Nigeria” by Francis Ogbimi, op. cit. p.10
[31] Chukwunwike Enekwechi, “The social research for a new Nigeria” in Restartnaija June 5, 2018. https://restartnaija.com/2018/06/05/social-research-new-consented-nigeria/ retrieved 22nd July, 2018
[32] Chukwunwike Enekwechi, “Maintenance culture and inefficient monitoring capacity in Nigeria” in Restartnaija, 8th May, 2018. https://restartnaija.com/2018/05/08/maintenance-monitoring-nigeria/ retrieved 22nd July, 2018