CHAPTER ONE 1.

1 BACKGROUND OF THE STUDY The earliest manifestation of globalization perceived by nation states in the eighteenth century was the scope for increased trade offered by a global market place considerably larger than the regional or national markets to which economic activity had until then been limited.

Over the past two decades, world output has been expanding and many countries are benefiting from increased cross-border trade and investments. Many others suffer because economic regimes are inefficiently managed, and this weakness reduces their capacity to successfully compete globally (Schneider and Enste, 2002).

Globalization is a very uneven process with unequal distribution of its benefits and losses. This imbalance leads to polarization between the developed countries that gain, and developing countries that lose out (Obadan, 2001). In this regard, the place of Nigeria in the globalization agenda requires some indepth study.

Nigeria is economically weak due to inadequate domestic economic capacity and social infrastructure needed to boost the countrys productivity, growth and competiveness. The economy is also made weaker by monocultural dependency and unfavourable terms of trade in its export trade as well as excruciating debt and debt service burdens (Obadan, 1998).

Following the globalization trend, Nigeria has been liberalizing its economy, but the real sectors have had to function under conditions of unstable macroeconomic
1

management, inadequate technology and credit facilities. These have proved to be an obstacle to strengthening the productive base, especially of agriculture and industry, in order to make them export oriented.

From the viewpoint of the IMF, the economic crisis in Nigeria is a product of structural distortions in the economy due to overvalued exchange rates, import regulation, poor investment management and low returns on capital, high wage structure and low productivity of workers, import substitution industrialization and its policy environment over-extended inefficient and unproductive public enterprises and their undue protection by government, and discriminatory credit policies against the private sector ( Onimode 1989; Olukoshi 1995; Beckman 1990; Adesina 1991,19994; Aina 1997; Zeleza 1997).

The economic restructuring project was, therefore, a major component of the globalization process introduced into Africa in the form of structural economic reforms known variously as economic stabilization programmes, economic adjustment policies, economic reform programmes or structural adjustment and global integration are interdependent and mutually reinforcing (Aina, 1997).

It is very obvious that the openness of the economy has not benefited Nigeria with the economy growing from bad to worse as people can no longer afford the basic necessities of life and industries in various cities folding up. The economic indicators shows that in 1998, 67.5% of the total population lived below poverty line and that by 2001, poverty situation became worse with the proportion of Nigerians living below the poverty line having risen to about 70% (Panet Memoradum, 2002).
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In dealing with the challenges of globalization, the argument is that economic globalization has not favoured the Nigerian economy, instead it has thrown up complex and intractable industrial problems associated with de-industrialization. As pointed out earlier, the obstacles that evolve from globalization and its policies have hindered the sustainable development that presupposes to offloads to Nigeria.

1.2 STATEMENT OF THE PROBLEM Few decades ago, globalization was adopted as a process that will lift Nigeria up to the stage of her developed nations counterpart. A close observation of Nigeria situation however reveals that rather than be a defy medicine against underdevelopment, it stand as blockage on the way of sustainable development in the country.

As a result of its effects, the question of; to what extent can we continue waiting for globalization to obviate some obstacles confronting sustainability development in Nigeria, can globalization truly leads this country to a greater height, what are the prospect of sustainable development in Nigeria keeps coming to our minds. These are the questions that this work seeks to answer.

1.3 OBJECTIVES OF THE STUDY The broad objective of this study is to examine the effect of globalization on sustainable development in Nigeria while it specific objectives are enumerated below: a) To examine the current trends of globalization in Nigeria. b) To juxtapose Pre-SAP and SAP globalization period in Nigeria
3

c) To X-tray that the process of globalization is responsible for the causes of incessant underdevelopment in Nigeria. d) To analyse the effects of globalization towards the achievement of sustainable development in Nigeria.

1.4 SIGNIFICANCE OF THE STUDY This research work will concentrate majorly with much emphasis on globalization and its effects on the sustainability of Nigeria economic development. Hopefully, I hereby ascertain that this research work will definitely shed more light to the dark hollow of globalization and acknowledge the Nigerians position and condition globally.

Hence, it will assist government policy makers, firms and individuals to formulate strategic plans that will bring about sustainable development in the country.

1.5 SCOPE OF THE STUDY The main focus of this research work will be on globalization and sustainable development in Nigeria from 1980-2006.

1.6 RESEARCH HYPOTHESIS Hypothesis I HO: There is no significant difference between globalization and sustainable development in Nigeria H1: There is significant difference between globalization and sustainable development in Nigeria

Hypothesis II HO: There is no significant different in Pre-SAP sustainable development and SAP era sustainable development in Nigeria. H1: There is significant different in Pre-SAP sustainable development and SAP era sustainable development in Nigeria.

1.7 PLAN OF THE STUDY This research work will be divided into five chapters.

Chapter one shall include the background of the study, statement of the problem, objectives of the study, significance of the study, scope of the study, research hypothesis and plan of study.

Chapter two will encompasses literature review which will give us broad guideline for the work and conceptual analysis.

Chapter three will focus on the research methodology, the procedure for data collection and procedure for analysis of the data collected.

Chapter four will interpret and analyze the data collected for the work and discuss the findings of the research.

Chapter five will summarize, conclude and make recommendations base on the research findings.

CHAPTER TWO (LITERATURE REVIEW) 2.1 CONCEPTUAL ANALYSIS 2.1.0 CONCEPT OF GLOBALISATIUON The term globalization is often used in contacts which are at first sight not directly related to our topic of research or only have some vague connections to it. This has to do with the fact that the term globalization has evolved from the term modernity and therefore combines many different aspects (schuurman, 2001) Globalization can be defined as the network of connections of organizations and people across national, geographic and cultural borders and boundaries (pearson Education, 2002).

Robertson (1992) sees the concept of globalization as referring to both the compression of the world as a whole. This compression which occurs in spatial and temporal terms contains different elements operating at the level f culture, consciousness, civilization, knowledge production and economic relations with a wide range of impacts generating multiple and diverse expressions and actions.

Globalization refers to the increasing importance of international trade, international relations, treaties, alliance, etc. international of course means between or among nations. The basic unit remains the nation even as relations among other nations become increasingly necessary and important (Daly, 1999)

Globalization, viewed from international organization perspective can be seen as being akin to integration. Integration, according to Familoni, (2003) is the means
6

of increasing the interaction and mingling of national units in order to obscure the boundaries between the system of international organizations and the environment provided by their nation state members.

Critics of globalization state that it is a form of controlling and influencing an economy of a country by overseas corporations which therefore implies a surrender of power from the local government. It is viewed as a means of keeping developing nations exactly that low paid workers, GM seed pressed on developing world farmers, the selling off of state IMF and world Bank loans and the increasing dominance of western corporate culture across the globe has come to symbolize globalization for its critics (the guidance, 2002). According to Giddens (1990), globalization can be defined as the intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa.

Globalization depicts the transformation of the relations between state, institutions, group and individuals; the universalization of certain practices, identities and structures and perhaps more significantly, the expression of a globe restructuring that has occurred in recent decades in the structure of modern capitalist relations (Aina, 1997).

The concept of globalization views the global economy as one, which works as a unit on real time on a planetary scale. It is an economy concept where capital flow labour and commodity markets, information, raw materials, management and organization are internationalized and fully interdependent throughout the planet.
7

It corresponds to an attempt at contraction of space and time through the development of new means of communication and information technologies across the planet (Hammouda, 2000).

Globalization perceives the world as a trade unit without socio-political barriers and constraints it is the process through which people, goods and services, trades, ideas and information flows across the borders of countries with ease (Asaju, 2002).

In concrete terms, globalization is the intensification of cross-border trade and increased financial and foreign direct investment flows among nations, promoted by rapid advances in and liberalization of communication and information technology (islam, 1999 and Aminat, 2002).

Ibrahim, drawing from james mittleman, insists, globalization is not a single unified phenomenon but rather a syndrome of processes and activities, which embody a set of ideas and a policy framework organized around the global division of labour and power (Ibrahim,2002). Globalization is generally the process of growing interconnection and interdependence in the modern world. It is generated by growing economic, cultural and political cooperation and links, as well as by the meed to respond together to global problems which can be solved only on a planetary scale (symonides, 1998).

Dauda abubakar pungently argues that globalization entails universalization whereby the object, practices or even values transcends geo-political boundaries, penetrating the hitherto sovereign nation state and impacting the orientation and value system of the people (Abubakar,op.cit) .

Globalization also depicts the transformation of the relations between states, institutions, groups and individuals, the universalization, of curtain practices, identities and structures, and perhaps more significantly the expression of the global restructuring that has occurred in recent decades in the structure of modern capitalist relations (Aina,1996).

Mike Kwanashine sees globalization as a part of the movement of history as evidence in certain forces that appear to push for increasing integration of human activities with emphasis in contemporary world focused more on the economic aspect of the process. It is a process of increased integration of national economies of state with the rest of the international system in order to create more coherent global economy (Kwanashie,1999).

As Nuhu Yaque copiously observes, globalization refers to the tremendous revolutionary changes that have affected our planet as a result of changes that have also taken place in information and communication technologies- processes that have, cumulatively, led to the villagization of the globe (Yaqub,2003).

From the perspective of the UNDP National Human Development; Globalization can be defined as a multidimensional process of unprecedented rapid and

evolutionary growth in the extensiveness and intensity of interconnections on a truly, global scale (UNDP; National Human Development Report, 2000/2001)

Ihonubere in ibid concluded that rather than improve on social, political and economic conditions, globalization has increased; poverty in both rural and urban arrears; real earnings fell drastically; unemployment and underemployment rose sharply; hunger and famine became endemic, dependence on food aid and food imports intensified; diseases, including the dreaded HIV/AIDS decimated populations and become a real threat to the very process of growth and development.

Aina, (2003) in a lecture argued that globalization as a process has three main clusters; culture and civilization; international division of labour; new information technology revolution capitalism and the expression of the global political and military order.

In conclusion, globalization is characterized by liberalization of the world economies and economic activities that are free from institutional control and which fosters and promotes free market mechanism, private enterprise, open competition, professionalism and excellence in corporate governance. It seeks to promote specialization and the principle of comparative advantage in the production of goods and services on a global scale. It is aimed at creating a new world economic order, efficiency, competitiveness, efficient allocation of resources and speedy growth of the world economy.

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2.1.1

CONCEPT OF SUSTAINABLE

ORiorden (1985), commented on the difficulty of defining sustainability, descending its definition as an; Exploration into a tangled conceptual jungle where watchful eyes link at every bend. Spending (1996), commented that perhaps this was the reason for; the remarkable number of books, chapters and papers, that even use sustainable or sustainability in the title but do not define either term. However, the root of the word sustainable comes from sus-tenere, meaning to upohold. Websters Dictionary (1999), defines sustainable as to keep in existence; to give support or relief to; to supply with sustenance.

Odum (1971) applies the concept of sustainability to biological sciences and writes that sustainable behavior is prudent behaviour by a predator that avoids over exploiting its prey to ensure an optimum sustainable yield.

Hicks (1946), defines sustainability as being able to maximize the value one can consume during a week and still expect to be as well off at the end o the week as at the beginning. According to the chambers concise Dictionary sustainability; from the verb to sustain meaning; to hold up; to bear; to support; to provide for; to maintain; to sanction; to keep going; to keep up; to prolong; to support the life of.

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2.1.2

CONCEPT OF DEVELOPMENT

The concept of development has to do with a rate of change in a particular direction. Change in technology, social, economic and political aspect of life resulting in happy life (imam, 1998).

Development explains the act of developing or process of being developed. It connotes an increase, propagation, expression, improvement or change for the better (Ibid, pg. 4).

Development emphasizes the discontinuous and spontaneous change in stationary state, which forever alters and displaces equilibrium state previously existing (seers, 1977).

Because of the emphasis on change, development has often been perceived synonymous with growth, economic growth with emphasis on increase in labour productivity and in total output, with technological process and industrialization (babalola, 1998).

Development is defined as a process of economic and social advancement which enable people to realize their potential, build self confidence and lead lives of dignity and fulfillment, it is a process aimed at free in people from the evil of wants, ignorance, social justice and economic exploitation.

Obasanjo and Mabogunje (1991) defines development as the transformation or change into a better state and must encompass the combination of the following

12

four (4) factors; knowledge and understanding, information- statistical and nonstatistical, technological creativity and the right kind of organization and skill.

Seers (1977) go further to identify curtain requirements that are pertinent in the process of understanding what development is all about. These, he presents to include adequate educational level (Literacy) participation in government and belonging to a nation that is truly independent both economically and politically in that the views of the other government do not largely predetermine ones own government decision.

Whatever way we may have looked at development, it is necessary to state that development whether interms of the economy, politics or social implies both improve and increase output and changes in the technical and institutional arrangement by which it is produced (Rodney Walter, 1972).

Cited in Ibid, Development is essentially used in an exclusive economic sense, this is basically because economy is in itself an index of other social features. Hence, development is used as a synonym for economic development. To this end, therefore all societies have experienced development at some points but the level of development differ from continent to continent and within each continent different parts/units their command and over nature at different rates (Lawal, 1992).

Amartya Sen (1999) has argued for an even broader concept of development focusing on the concept of freedom. He sees development as an integrated process of expansion of substansive freedoms. Economic growth, technological
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advancement and political change are all to be judged in the light of their contributions to the expansion of human freedoms. Among the most important of these freedoms are freedom from famine and malnutrition, freedom from poverty, access to health care and freedom from premature mortality.

2.1.3

CONCEPT OF SUSTAINABLE DEVELOPMENT

Sustainable development is one of those modern expressions or concepts widely used although imperfectly defined or formulated. It arose from a rough idea developed in the sixties in the context of conservation of nature and natural resources and entered the discourse of ecologists, economists, agriculturists, developers and politicians after the Rio Conference of 1992. Brundtland (1987): This is the most commonly quoted definition and it aims to be more comprehensive than most: Sustainable development is development that meets the needs of the present without compromising the needs of future generations to meet their own needs. It contains within it two key concepts: The concepts of needs, in particular the essential needs of the worlds poor, to which overriding priority should be given, and: The idea of limitations imposed by the state of technology and social organization on the environments ability to meet present and future needs. To Pearce, Makandia & Barbier (1989), Sustainable development involves devising a social and economic system, which ensures that these goals are sustained, i.e. that real incomes rise, that educational standards increase, that the health of the nation improves, that the general quality of life is advanced.

14

Given the discussion above, this statement can be put more fundamentally: Sustainable development is increasing well-being over a very long time. Yet, sustainable development is increasing consumption, following its broadest economic interpretation, over a very long time. Sustainable development is concerned with the development of a society where the costs of development are not transferred to future generations, or at least an attempt is made to compensate for such costs. (Pearce, 1993) According to the report of the joint UNECE,OECD/EUROSTAT: It seems reasonable to interprete sustainable development as development that can continue forever or at least for a very long time; say for several generations. In view of Holdgate (1993): Development is about realising resource potential, Sustainable development of renewable natural resources implies respecting limits to the development process, even though these limits are adjustable by technology. The sustainability of technology may be judged by whether it increases production, but retains it other environmental and other limits. In the opinion of Jekwu Ikene, (1998): Sustainable development requires that the stock of natural, man, man-made, social and human capital should not decline, or if you like depreciate below the present level. This has come to be known as the constant capital rule (CCR). Cited in Jhinghan(2005): Sustainable development means that development should keep going. It emphasizes the creation of sustainable improvements in the quality of life of all people through increases in real income per capita, improvements in
15

education, health and general quality of life and improvements in quality of natural environmental resources. Thus, sustainable is closely linked to economic development. It is a situation in which economic development does not decrease over time. Sustainable development is development that is everlasting and contributes to the quality of life through improvements in natural environment. Natural environment in turn, supply utility to individuals, inputs to economic process and services that support life. As pointed out by Pearce and Warford in Jhinghan(2005), Sustainable development describes a process in which natural resource base is not allowed to deteriorate. It emphasizes the hitherto unappreciated role of environmental inputs in the process of raising real income and the quality of life. The concept of sustainable development does imply limits- not absolute limits but limitations imposed by the present state of technology and social organization on environmental resources and by the ability of the biosphere to absorb the effects of human activities. Inconclusion, the below diagram depict the definitions of sustainable development:

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WHAT IS TO BE SUSTAINED:

FOR HOW LONG?

WHAT IS TO BE DEVELOPED?

25 years Now and in the future Forever

NATURE Earth Biodiversity Ecosystems

PEOPLE Child survival life expectancy Education Equity Equal opportunity

LIFE SUPPORT Ecosystem Services

LINKED BY Only Mostly But And Or

ECONOMY Wealth Productive Sector Consumption

COMMUNITY Culture Groups Places

SOCIETY Institution Social Capital State Regions

Source: U.S. National Research Council, Policy Division, Board on sustainable Development, our common journey: A transition toward sustainability (Washington, DC: National Academy Press, 1999).

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2.2 THEORIES OF DEVELOPMENT 2.2.1 ROSTOW This is a linear theory of development. Economies can be divided into primary secondary and tertiary sectors. The history of developed countries suggests a common pattern of structural change: Stage 1 Traditional Society Characterised by subsistence economic activity ie output is consumed by producers rather than traded, but is consumed by those who produce it; trade by barter where goods are exchanged they are 'swapped'; Agriculture is the most important industry and production is labour intensive, using only limited quantities of capital. Stage 2 Transitional Stage The precondition for takeoff. Surpluses for trading emerge supported by an emerging transport infrastructure. Savings and investment grow. Entrepreneurs emerge. Stage 3 Take Off Industrialisation increases, with workers switching form the land to

manufacturing. Growth is concentrated in a few regions of the country and in one or two industries. New political and social institutions are evolve to support industrialisation.

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Stage 4 Drive to Maturity Growth is now diverse supported by technological innovation. Stage 5 High Mass

Implications of Rostow's theory Development requires substantial investment in capital equipment; to foster growth in developing nations the right conditions for such investment would have to be created i.e. the economy needs to have reached stage 2. For Rostow Savings and capital formation (accumulation) are central to the process of growth hence development The key to development is to mobilise savings to generate the investment to set in train self generating economic growth. Development can stall at stage 3 for lack of savings 15-20% of GDP required. If S = 5% then aid/loan = 10-15% plugs savings gap. Resultant investment means a move to stage 4 Drive to Maturity and self generating economic growth

19

Limitations of Rostow's Model Rostow's model is limited. The determinants of a country's stage of economic development are usually seen in broader terms i.e. dependent on: the quality and quantity of resources a country's technologies a countries institutional structures e.g. law of contract Rostow explains the development experience of Western countries, well. However, Rostow does not explain the experience of countries with different cultures and traditions e.g. Sub Sahara countries which have experienced little economic development.

2.2.2 HARROD-DOMAR The Harrod-Domar model developed in the l930s suggests savings provide the funds which are borrowed for investment purposes. The economy's rate of growth depends on: the level of saving and the savings ratio the productivity of investment i.e. economy's capital-output ratio For example, if 8 worth of capital equipment produces each 1 of annual output, a capital-output ratio of 8 to 1 exists. A 3 to 1 ratio indicates that only 3 of capital is required to produce each 1 of output annually.
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Further Analysis The Harrod-Domar model developed in the 1930s to analyse business cycles. it was later adapted to explain economic growth. Economic growth depends on the amount of labour and capital i.e. ?NY = f(K,L) Developing countries have an abundant supply of labour. So it is a lack of physical capital that holds back economic growth hence economic development. More physical capital generates economic growth. (use Production Possibility Boundaries to illustrate) Net investment (ie investment over and above that needed to replace worn out capital (deprecation) leads to more producer goods (capital appreciation) which generates higher output and income. Higher income allows higher levels of saving.

Implications of the Harrod Domar Model Economic growth requires policies that encourage saving and/or generate technological advances, which lower capital-output ratio. Criticisms of the model

21

Domar: My purpose was to comment on business cycles, not to derive "an empirically meaningful rate of growth." It is difficult to stimulate the desired level of domestic savings Meeting a savings gap by borrowing from overseas causes debt repayment problems later. Diminishing marginal returns to capital equipment exist so each successive unit of investment is less productive and the capital to output ratio rises. The amount of investment is just one factor affecting development eg supply side approach (free up markets); human resource development (education and training) Economic growth is a necessary but not sufficient condition for development Sector structure of the economy important (ie agriculture v industry v services)

2.2.3

DEPENDENCY THEORY

Dependency refers to over reliance on another nation. Dependency theory uses political and economic theory to explain how the process of international trade and domestic development makes some LDC's ever more economically dependent on developed countries ("DC's"). Dependency theory refers to relationships and links between developed and developing economies and regions.

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Dependency theory sees underdevelopment as the result of unequal power relationships between rich developed capitalist countries and poor developing ones. Powerful developed countries dominate dependent powerless LDC's via the capitalist system. In the Dependency model under development is externally induced (ie DC not LDCs fault) system. Growth can only be achieved in a closed economy and pursue self-reliance through planning. Dominant DC's have such a technological and industrial advantage that they can ensure the rules of the game (as set out by World Bank and IMF) works in their own self interest. This partly explains the hostility shown towards the WTO in Seattle in 1999. In this model under development is externally induced (i.e. DC not LDCs fault) and only a breakup of the world capitalist system and a redistribution of assets (e.g. elimination of world debt) will free LDC's

2.2.4 LEWIS THEORY The Lewis model is structural change model that explains how labour transfers in a dual economy. For Lewis growth of the industrial sector drives economic growth. The Lewis Model argues economic growth requires structural change in the economy whereby surplus labour in traditional agricultural sector with low or zero marginal product, migrate to the modern industrial sector where high rising marginal product.
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Transferring surplus labour from rural to urban areas has no effect on agricultural productivity as MP of rural workers = 0. Firms profits are reinvested. Growth means jobs for surplus rural labour. Additional workers in urban areas increase output hence incomes and profits. Extra incomes increase demand for domestic products while increased profits fund increased investment. Hence rural urban migration offers self-generating growth. The ability of the modern sector to absorb surplus works depends on the speed of investment and accumulation of capital. Where firms invest in new labour saving capital equipment, surplus workers are not taken on by the formal sector. Recently arrived rural migrants join the informal economy and live in shantytowns given urban growth drives economic growth it can lead to the neglect of agriculture by government Neglect of Agriculture yet most people live in rural areas where incomes are relatively low Increased profits may be invested in labour saving capital rather than taking on newly arrived workers for many LDC's, rural urban migration levels have been far greater than the formal industrial sectors ability to provide jobs. Urban poverty has replaced rural poverty. 2.3 STAGES OF THE MODERN ERA OF GLOBALIZATION

Economic historians date the modern era of globalisation to approximately 1870. The period from 1870 to 1914 is often considered to be the birth of modern world economy, which by some measures was an integrated as it is today.

What historians have observed in that, from the point of view of capital flows (the predominately British foreign direct investment and portfolio investment of the era), the late 1809 were an extraordinary time. The global integration of capital
24

market was facilitated by advance in rail and ship transportation and in telegraph communication. European colonial systems were at their highest stages of development, and migration was at a historical high point in relation to the global population of the time.

This first modern stages of globalisation was followed by two additional stages, one from the late 1940s to the mid-1970sand another from the mid-1970s to the present.

These however, were preceded by World War I, the great depression, and World War II. During this time, many aspects of globalisation were reversed as the world experienced increased conflicts, nationalism and paterns of economic autarky. To some extent, then, the second and third modern stages of globalisation involved regaining lost levels of international integeration.

The second modern stage of globalisation began at the end of World War II. It was accompanied by a global, economic regime developed by the brettton woods conference of 1944 establishing the international monetary fund (IMF), what was to become the world bank, and the general agreement of tarrifs and trade (GATT). This stage of globalisation involved an increase in capital flow from the united state as well as US founded production system that relied on exploiting economies of skill in manufacturing and the advanced of US based multinational enterprises.

This second stage also involved some reduction of trade barriers under the auspices of (GATT). Developing countries were not highly involved in this liberalization, however in export product of interest to developing countries
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(agriculture, textiles, and clothing) a systems of non staff barrier in rich counties involved. Also a set of key developing countries, especially does in latin America, pursued import substitution industrializations with their own trade barriers. These development, along with the cold war, suppressed the integration of many countries into the world trading system.

The third modern stage of globalisation began in the late 1970s. this stage followed the demised of monetary relationships developed at the Bretton woods conference and involved the emergence of the newly industrialized countries of east asia, especially Taiwan (china), and the republic of korea. Rapid technological progress, particularly in transportation, communication, and information technology, began to dramatically lower the costs of moving goods, capital, people, and ideas across the globe. For example, as noted by frankel (2000), now fresh-cut flowers, perishable broccoli and strawberries, live lobsters and even ice cream are sent between continents.

Assembly system in this latest stage of globalisation were also significantly modified into a new arrangement characterized by flexible manufacturing. In flexible manufacturing system in this latest stage of globalisation were also significantly modified into a new arrangement characterized by flexible manufacturing. In flexible manufacturing systems, information technology supports computer aided production and relies less on economies of scale. In this stage,Japan emerged as an important, new source of foreign direct investment (FDI), between 1960 and 1995, Japans share of global FDI increased from less than 1 percent to over 10 percent. The thawing of the cold war, the entry of china into the world economy and a general reduction of trade barriers in most
26

developing countries beginning in the late 1980s, helped to accelerate global integration during this phase.

2.4

ECONOMIC HISTORY OF NIGERIA

Since almost 550 years International Trade has been affecting the Economic Development of Nigeria. It first started with the trade of goods and soon expanded to the Slave Trade. The huge impact the Slave Trade had on Economic growth in Nigeria was positive (although immoral), but even though some gained from this, it also meant that through people being enslaved, farmland went uncultivated. With the Slave Trade declared illegal Nigeria searched for other resources which could be sold to Europe to further increase Economic Development. (Metz, 1991)

After Nigeria became a British colony, its economy was linked to the rules and regulations given by them. Nigeria like other colonies used the trade circle started with the export of raw materials by Nigeria for the manufacturers in England who later sold the final products back to Nigeria at a higher margin of profit. Over the years the British started to update and modernise the infrastructure of the country. This helped domestic manufacturers to gain a dominant position over imported products, making Nigeria a net exporter. Although the majority of Nigerians were still working in the agricultural sector where they earned just enough to survive, Nigeria was able to benefit from the globalisation of industry brought to them by the British (Ekundare, 1976).

In 1914 the British Government in Nigeria unified its northern protectorate with its southern colony to form the country we today know as Nigeria. The first years of the century and the great depression had led to many ups and downs in the
27

Economic Development of Nigeria, this economic circle ended with the end of World War II and the world wide increase for supplies. Even if Nigeria remained an agricultural country it started to build a modern industry. With the discovery of oil in the last years of British rule and with a stabilised economy and political situation, Nigeria stepped into independence with the hope to soon become a country of minor wealth for everybody (Ibid).

2.5

GLOBALIZATION AND NIGERIA SUSTAINABLE DEVELOPMENT

Globalization has become a commonly used word world-wide. It is no longer a new concept or phenomenon in the academic and business world as social scientists, journalists, business analysts, management theorists, writers and commentators generally have at various times used and will continue to use the word in particular contexts for declared and undeclared purposes, with more or less effectiveness in their attempt to explain or interpret issues in this changing and complex world (Akinlo, 1998).

Thus, inspite of the openness of the economy, external trade performance has not been encouraging as the table shown below:

Nigeria Foreign Trade 1985-2006

Imports Year
1985 1986 1987 1988

Exports Oil
11,223.70 8,368.50 28,208.60 28,435.40

Total Trade Oil

11,275.50 9,282.40 31,378.70 32,238.50

Balance of Trade Oil

11,171.90 7,454.60 25,038.50 24,632.30

Oil
51.8 913.9 3,170.10 3,803.10

Nonoil
7,010.80 5,069.70 14,691.6 17,642.6

Nonoil
497.1 552.1 2152 2757.4

Nonoil
7,507.90 5621.8 16,843.60 20,400.00

Nonoil
6513.70 4517.60 12,539.60 14,885.20

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1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

4671.60 60,731 7,595.30 19,937.20 41,329.30 42,349.60 155,825.90 162,178.70 166,902.50 175,854.20 211,671.30 220,817.7 237,106.8 361,710.0 398,922.3 318,114.7 182,754.8 221,086.4

26,188.60 39,644.80 79,424.90 125,974.20 124,771.10 120,439.20 599,301.80 400,447.90 678,814.10 661,564.50 650,836.00 764,204.7 1,121,073.51 1,150,985.3 1,681,313.0 1,668,930.6 2,296,567.7 2,306,999.6

55,016.80 106,626.50 116,858.10 203,292.70 213,778.80 200,710.20 927,565.30 1,286,215.90 1,212,499.40 717,786.50 1,169,508.50 1,920,900.4 1,839,945.3 1,649,445.8 2,993,110.0 4,489,472.2 6,266,096.6 5,619,152.9

2954.4 3259.6 4677.3 3973.3 4991.3 5349 23,096.10 23,327.50 29,163.30 34,070.20 19,498.00 24,822.9 28,008.6 94,731.8 94,776.4 113,309.4 105,955.8 133,594.9

59,688.40 112,699.60 124,453.40 233,229.90 255108.1 243059.8 1,083,391.20 1,448,394.60 1,379,401.90 893,640.70 1,381,179.00 2,141,718.1 2,077,052.1 2,011,155.8 3,392,032.3 4,807,586.9 6,448,851.4 5,840,239.3

29,143.00 42,904.40 84,102.20 129,947.50 129,762.40 125,788.20 622,397.90 423,775.40 707,977.40 695,634.70 670,334.00 789,027.6 1,149,082.1 1,245,717.1 1,776,089.4 1,782,240 2,402,523.5 2,440,594.5

50,345.20 100,553.40 109,262.80 183,355.50 172,449.50 158,360.60 771,739.40 1,124,037.20 1,045,596.90 541,932.30 957,837.20 1,700,082.7 1,602,838.5 1,287,735.8 2,594,187.7 4,171,357.5 6,083,341.8 5,398,066.5

23,234.20 36,385.20 74,747.60 122,000.90 119,779.80 115,090.20 576,205.70 377,120.40 649,650.80 627,494.30 631,338.00 739,381.8 1,093,064.9 1,056,253.5 1,586,536.6 204,805.3 2,190,611.9 2,173,404.7

Source: Kamla-Raj-Social Sc.,Journal,14(1):45-51(2007). 2. CBN statistical bulletin,vol. 17, Dec. 2006, pg. 213

A study of the above table shows that oil exports dominate Nigerias foreign trade, accounting for more than 80 per cent of exports during the yearsunder consideration. Food, agricultural raw materials and manufactures accounted for only 1 per cent of total export in 1990, but this fell to 0 per cent in 2000. In between that period, the country never exported ores and metals (WorldBank, 2002). As a monocultural exporter, over 80 per cent of Nigerias exports is made up of crude petroleum. But instability in the world oil market sometimes negatively affects oil exports, leading in such circumstances to declines in foreign exchange earnings as is shown in table above. This partly explains the countrys recourse to external funding in order to meet its development challenges.

29

Financial market liberalization, also exposes the country to volatility and shocks. Yet, access to credits is granted to the country under strict conditionalities. Moreover, the shortfalls in servicing Nigerias debt have led Export Credit Guarantee Agencies (ECGA) to suspend insurance cover for export of goods, services and investment to the country. Nigerian importers are also required to provide 100 per cent cover for all their order. As such, they are placed at competitive disadvantage to those who have access to ECGA covers and import credit facilities (Debt Management Office, 2001).

This situation exacerbates the pains of the external debt and hampers the inflow of foreign resources needed for the stimulation of investment and growth. FDI inflows to Nigeria amounted to 588 million dollars in 1990. This rose to 1,079 million dollars in 1995, but declined to 930 million dollars in 2000 (UNCTAD, 2002b). Worldwide FDI in 2001 were 823.8 billion dollars and Nigeria attracted only 1.1 billion dollars or 0.13 per cent of that amount.

Although global FDI declined to 651.2 billion dollars in 2002, Nigeria increased her share to 0.19 per cent of such investments as she attracted 1.3 billion dollars of FDI that year (UNCTAD, 2003b).

However, that share is meager and it is explained by the peripheral position of the country in the financial and profit calculations of industrialized nations and the countrys marginalized status within the orbit of modern capitalism. In discussing globalization vis--vis Nigerias development, two issues deserve consideration. The first relates to the Washington consensus and the second
30

concerns the wisdom of opening the economy to international monopoly capitalism. In addressing these issues, we observe that the IMF/World Bank and their Western collaborators are satisfied with the peripheral role of Nigeria as an exporter of raw materials, especially crude petroleum, to and importer of manufactured goods from the West. In this connection, Stewart (2002) maintains that the capitalist need to sustain the import capacity of peripheral economies in order to facilitate continued production and maximize profits at the centre explains why in the periphery countries raw material exports are encouraged. In that event foreign exchange receipts are low; this makes external loan contraction inevitable for social and economic development. Nigeria is no exception to this rule. But then, contracted debts due for repayment, which the country cannot actually pay, are only being reprogrammed, not written off because their continued servicing helps to maintain financial stability at the centre.

But globalization can be of immense benefit to Nigeria and so could help the countrys development. The enabling framework would include measures to ensure the entry of Nigerias non-oil exports into the core markets without discrimination. In this regard, the diversification of domestic production is imperative. The unsustainable debt, which weighs the country down economically also needs to be tackled with faster and deeper debt relief by developed nations, while expanded development cooperation with them would strengthen the productive base of the Nigerian economy.

The international financial architecture also requires to be broadened and deepened through global solidarity that would see increased inflows of foreign investments into the country. This accomplished, globalization would contribute to
31

enhancing the living standards of Nigerians as the country joins the League of Nations enjoying the benefits of that process.

2.6 GLOBALIZATION POLICIES AND STRATEGIES FOR SUSTAINABLE DEVELOPMENT IN NIGERIA The challenges of sustainable economic development for Nigeria in the face of growing assertiveness of the forces of globalization are arduous. Considering that sustainable development is attained through the utilization of available resources to enhance the social and economic well-being of the society without compromising on future needs, it is only the people in any society that can generate and sustain economic development.

However, globalization infringes on the ability to implement internally cohesive macroeconomic policies for Nigeria since she is to adhere to the basic rules of the international economic system.

There is therefore, the lack of policy autonomy as a result of tying the hands of weak countries like Nigeria by the most powerful countries and in macroeconomics, policy autonomy is critical to the size of policy multipliers.

Lagos has the history of earlier responses to global reforms in organization of production, economic policies with significant spatial effects than any other city in the West African sub-region. This could be traced to the rate of responses of cities in Nigeria to recent global economic policies in Africa at the dawn of the twentyfirst century.

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Thus, three recent global social-economic policies are discussed in this research work within the context of Nigeria, these policies are the Structural Adjustment Programme (SAP), the New Partnership for Africa Development (NEPAD) and the concept of Privatization.

2.6.1 THE STRUCTURAL ADJUSTMENT PROGRAMME (SAP) The Structural Adjustment Programme (SAP) was introduced into Nigeria as a response to the International Monetary Fund technical advice as a response to the recognition of the structural distortion in the Nigeria economy in 1986. The SAP was also designed to restore medium term viability to the balance of payment options of Nigeria. Adedeji (1990) stated that it may have been necessitated by the devastations of irresponsible domestic economic policies.

However, it requires policy action by deficit and surplus countries. This is necessary for the policy to produce the desired effects especially for developing economies (Adeniji, 2003). Specifically SAP was introduced into Nigeria when it became evident that the ad-hoc policies of the past could not bring about the desired change in the economy. It was aimed to achieve the following restructuring and diversification of the productive base of the economy, to achieve fiscal and balance of payment, to lay the basis for a sustainable non-inflationary or minimal inflationary growth, to lessen the dominance of unproductive investments in the public sector and to improve the sectors efficiency and intensify the growth potential of the private sector.

Despite the comprehensive breath, and the radical determination which characterised the programme, SAP was confronted with many problems during
33

implementation some of which include substantial increases in prices of goods and services. Since its implementation relied on market forces to dictate the direction of the economy in an environment of insufficient government bureaucracy, relatively narrow and weak private entrepreneurship, high dependence on foreign input, it failed to produce the desired or optional solutions envisaged. It led to the collapse of the industrial sector as most industries could not cope with the high cost of imported raw materials and machinery. The housing and building materials sector also collapsed and a temporary stagnation was experienced in the construction and sustainable urban development sectors of the economy.

2.6.2 THE NEW PARTNERSHIP FOR AFRICA DEVELOPMENT (NEPAD) The New Partnership for Africa Development (NEPAD) formulated by African leaders as a roadmap to Africas development in the new millennium is worth mentioning. The thrust of NEPAD is that Africas development strategy must be experimental and not imposed. It is also aimed at new partnership that is both credible and capable of reversing Africa protracted economic and political backwardness and increasing marginalisation in the world economy (Adeniji, 2003).

This new policy is based on the condition that African out of their own volition are ready to take their destiny in their hands. That development is about empowerment and self-reliance and that its sustenance has to rest on the people and not the foreign benevolent guardians (Omoweah, 2003). NEPAD is however a comprehensive document on Africa future and position relative to global development. It comprises of policies on peace, security, democracy, politics,
34

governance,

infrastructure,

human

resource

development,

agriculture,

environment, culture, science and technology, capital flow and market access.

Each theme has a programme of action. For example under infrastructure, it highlights vision on roads and highways, airports, seaports, railways, waterways and telecommunications. It states the need to increase investment in infrastructure and establishment of African institutions that will train and produce highly skilled technicians and engineers. Similarly under information and communication technology sub-theme, it stresses the need to work with regional agencies such as the African Telecommunication Union to design model policy legislation for telecommunication reform, regulatory capacity, establishment of a network of training and research institutions to built high-level manpower.

Despite the impressive aim of NEPAD many scholars on Africa political economy are sceptical about its prospect, as the restructuring of the World Order has had many painfully consequences for Africa. With the mutation of GATT to WTO, for example, Africa forfeited a fairly reliable platform for tabling her grievances relating to multilateral trade agreement. Also, the greatest strength of Africa in world trade which is export of primary products has been eroded by biotechnology through the development of synthetic alternatives to primary commodities.

This definitely places Africa in a poor position in the WTO, thus positioning Africa in a largely unfavourable trading position in a global context. This situation Aderemi (2003), noted places Africa in a peripheral position in the world economy as it has increasingly declining demand of her products in the world market. The option for survival is to make her market open, its policies structured to
35

accommodate market signals with limited negotiating strength to dictate market prices. For NEPAD to survive therefore Africa will have to pool her resources together in order to place her in a better position of negotiation. This will entail a radical and combative approach to solving the economy dilemma of the country and bring about sustainable development.

2.6.3 THE CONCEPT OF PRIVATIZATION The third global economic policy ravaging the world is the concept of privatisation, especially of the State owned enterprises, services and infrastructure. Generally, it involve the selling or leasing on State assets to the private sector. Its merits include its ability to reduce financial burdens on strained government budgets, capacity to improve efficiency of services and potential for attracting investment to capital starved sectors. It has the capacity to offer the chance of improving both the livelihoods of individuals and the services which they depends on in their day to day lives. Presently in Nigeria the State have over-extended themselves, suffocating private and community initiatives in the provision and management of municipal services such as waste management, rail transit, parks, parking, water supply, electricity, telephone, amongst others.

Privatisation might not be total withdrawal leaving everything to the private sector. Appropriate government intervention such as policy formation and monitoring are always in the hands of government. These demand highly skilled public administrators capable of performing such complex technically difficult and politically sensitive tasks. These requirements are not presently well developed in many developing countries including Nigeria. This means that government will have to prepare for this new role of transition from providers to enablers. Also
36

government will not only make initial assessments on how services should be supplied but also to administer her role as supervisor once these establishments are taken over by the private sector.

The capacity required should include ability to analyse and maintain market conditions, manage and enforce contracts, regulation of monopolists, coordinate, finance and support producers, enable community self provision and support consumers with information and alternatives (Batley, 1994). This can only be achieved with government institutions sufficiently equipped to maintain the delicate balance between supporting private and community efforts. Towards achieving these objectives the Nigeria government established the Bureau of Public Enterprises (BPE) to facilitate the privatisation of many government agencies in various sectors which include the oil sector, power,

telecommunication, cement, hospitals, hotels, steel, air lines amongst others. Appreciable progress have been made by the BPE, however efforts towards privatisation in Nigeria has been confronted with many teething problems among which are under pricing, unattractive incentives, instability in policies and enforcement. Most of the implementation efforts have been unfriendly to the people.

2.7 CHALLENGES OF GLOBALISATION IN NIGERIA The challenges posed by globalisation for Nigeria are multivarious first for the country to be fully integrated into the world economy and in order to harness the benefits of such integration, it must embark on serious technological revolution. As Shamsudden usman pungently remarks, the pervasiveness of technology is such that a countrys ignores it at its own peril; (Usman,op ct;56). In order to
37

ensure technological revolution, the countrys technological base must be developed, science and technology should be made a formidable part of the key strategic area of its development effort .The need to fundamentally transform the nations educational, health, agriculture and industrial development has therefore become an imperative demand. Due attention must equally be focused on

information technology and telecommunication in contemporary global economy, information technology and the ability to use it are very critical, while computer and others electronics gadgets are already in place and do not need to be reinvented, there is the need to be re-invented, there is the need to ensure that the enabling environment for their uses is provided. Hence, adequate basic infrastructure such as power supply and telecommunications must exist regularly and uninterruptedly .while agriculture should be re-invigorated, while mechanized farming should be fully embraced to enhance agricultural productivity.

The second challenge relates to economic liberalization. The liberalization policy of the asian tigers tremendously enhanced their development .this entails liberalizing the economy ,internationalizing of capital, opening new markets and attracting new investments .this poses a great challenge to Nigeria . I agree with Usman that the Nigerian economy must not only be diversified, but also built on sound economic policies including those that will necessarily ensure increased domestic savings; continued reform of the domestic financial sector; opening up to foreign capital inflows, while simultaneously protecting the country from the huge sum destabilizing effects of short term, speculative capital inflows, and together with other developing countries, continue to champion the necessity for the reform of the global financial system that ensures shared prosperity and a greater inducement to the development of the weaker countries (Ibid;58).
38

The heavy dependence of the country on crude oil exports has unprecedently; exposed the economy to the boom and bust cycles and the concomitant unstable and unpredictable volume of revenues receivable by the government ; (yaqub 2003;41].for instance, Nigerias total export receipts from goods, service and transfer dropped from #10,899.6million in 1979 to#7,884.2million in 1983.The countrys import at the same time increased from #9,890.1million to #11.022.1million during the same period (CBN Economic and financial review 1981-1980). This also affects contributions of the countrys Gross Domestic Product (GDP). For instance as at 1999, oil and gas contributed 36.5% of the GDP, while agriculture (including livestock) accounted for 32.8% in the same period, wholesale and retail trade contributed 16.6%, while manufacturing accounted for 32.8% in the same period, wholesale and retail trade contributed 16.6%,while manufacturing accounted for only 5.5% of the GDP

(ANYA.2001;15). There is therefore, the need to diversify the economy and focus on non oil sector, particularly agricultural and mineral resources.

In addition , the country should maintain a healthy investment climate that can be cashed by foreign investors .it should also pursue efficient and effective economic management of the countrys resources so as to raise the peoples standard of living and overall economic development of the nation .it must be stressed however that in its bid to liberalize the economy, the unbridled activities of the multinational corporations in the country should be closely monitored and controlled so that the country will not be reaped off by foreign capital .The fact that globalisation entails opening up does not signify that the economy should be completely left uncontrolled .
39

Democracy constitutes the third challenge that globalisation poses for Nigeria. Democracy has become an acceptable form of governance in the world system indeed, No authoritarian or dictatorial regime is fashionable any longer in the global environment .as observed by the UNDP National Human Development Report.

The end of the cold war provided a historic opportunity for a worldwide liberal democratic revolution .in view of the western industrialized market economies, the collapse of authoritarianism and socialist central planning has revalidated the claim of liberal democracy, as an ideology of potentially universal validity (UNDP,National Human Developmennt Report for Nigeria,2000/2001,p.2).

Nigeria regained its civil rule in 1999 after about fifteen years of uninterrupted military dictatorship .The persuasive lack of democratic system of governance for several years had significantly deteriorated the developmental pace of the country ,following the restoration of civilian government .therefore there is the need for democracy to be fully entrenched and sustained .as stressed in the National Human Development Report ,there must be a strong and vibrant civil society, good governance, effective dynamic relationship between people and the government and entrusting the management of the state in the hands of men and women of the high technical competence and integrity ; (Ibid, p.42). The country must be truly committed to, and demonstrate the capacity for good governance as a bedrock for a durable democracy.

40

CHAPTER THREE (RESEARCH METHODOLOGY) 3.1 INTRODUCTION This chapter will describe the strategies that will be adopted in collecting information and the data which the research hypothesis will be tested and analyzed.

3.2 POPULATION SIZE The population of the study covers the trend of globalization on sustainable development in Nigeria.

3.3 SAMPLE SIZE The study deals with the effect of globalization on sustainable development in Nigeria. Hence, data will be obtained for the period of 1980 to 2006. This makes a sample size of 26 years.

3.4 METHOD OF COLLECTING DATA The nature of this study or research work necessitates the use of secondary data. This data will be obtained from various publications like; a) b) c) central bank of Nigeria (CBN) publications UNTAD report. Relevant journals and texts.

41

3.5 MODEL SPECIFICATION The gross domestic products (GDP) have been quitted to sustainable development. Hence, GDP serves as the dependent variable and import, export, foreign direct investment serves as the independent variables. The model is however, specified below; Y = F (M, E, FDI) Y = b0 + b1M + b2E + b3FDI + U GDP = b0 + b1M + b2E + b3 FDI + U Where, GDP = sustainable development M = import E = export FDI = foreign direct investment B0 = intercept of the model B1, b2, b3 = parameters of the model U = error term (stochastic variable)

3.6 METHOD OF DATA ANALYSIS This deals with the statistical method to be adopted in analyzing and collecting data for the purpose of this study. However, the econometrics tool of regression analysis using statistical package for social sciences (SPSS) will be employed.

42

CHAPTER FOUR 4.1 PRESENTATION OF DATA YEARS GDP IMPORT EXPORT 14186.70 1980 49632.30 9095.6 11023.30 1981 50456.10 12839.6 8206.40 1982 51653.40 10770.5 7502.50 1983 56312.90 8903.7 9088.00 1984 62474.20 7178.3 11720.80 1985 70633.20 7062.6 8920.60 1986 71859.00 5983.6 30360.60 1987 108183.0 17861.7 31192.80 1988 142618.0 21445.7 57971.20 1989 220200.0 30860.2 109886.10 1990 271908.0 45717.9 121535.40 1991 316670.0 89488.2 205611.70 1992 536305.1 143151.2 218770.10 1993 188136.6 165629.4 206059.20 1994 904804.7 162788.8 950661.40 1995 1934831 755127.7 1309543.40 1996 2703809.0 562626.6 1241662.70 1997 2801972.6 845716.6 751856.70 1998 2721178.4 837418.7 1188969.80 1999 3313563.1 862515.7 1945723.30 2000 4727522.6 985022.4 1867953.90 2001 5374334.8 1358180.3 1744177.70 2002 6232243.6 1512695.3 3087886.40 2003 6061700.0 2080235.3 4602781.50 2004 11411066.9 1987045.3 6372052.40 2005 14610881.4 2479322.5 5752747.70 2006 18564594.7 25280860

FDI
3620.10 3757.90 5382.80 5949.50 6418.30 6804.00 9313.60 9993.60 11339.20 10899.60 10436.10 12243.50 20512.70 66787.00 70714.60 119391.6 122600.9 128331.9 152410.9 154190.4 157508.6 161441.6 166631.6 178478.6 249220.6 324656.7 481239.1

4.2.1 PRESENTATION OF REGRESSION RESULT FOR HYPOTHESIS I GDP = -373944.5- 1.019 + 1.858 + 19.733 T ratio = (-1.910) (-1.574) (6.534) (5.040) R- Square (R) = 0.979
43

Adjusted R = 0.977 Standard Errors = (195777.38) (0.647) (0.284) (3.915) F- Statistic) 3,23) = 365.369 Durbin- Watson = 1.415

4.2.2 INTERPRETATION OF REGRESSION RESULT THE co-efficient of determinant (R ) shows that 97.9% of the variation in the dependent variable (GDP) is explained by the independent variables (import, export, FDI ).

This means that only 2.1% of the variation in GDP is explained outside the model. The result shows that only import indicators have a negative relationship with gross domestic product (GDP) in the model while others were positively related. By making use of two tailed-test at 0.05 level of significant, 25 degree of freedom, the critical value of t* or table value = 2.060.hence, since tc (5.040) is greater than t* (2.060) Hi should be accepted and we do not accept Ho.

Also, F- statistic confirms the statistical significance of globalization and sustainable development since Fc (365,369) is greater than F* (3.03). Likewise, the Durbin-watson statistics falls between 0 and 2, which is 0<1.415<2. it is however, concluded that globalization and sustainable development are strongly positively auto correlated.

44

4.3.1 PRESENTATION OF REGRESSION RESULT FOR HYPOTHESIS II (PRE-SAP PERIOD) GDP = 21319.357 0.327 + 1.231 + 4.777 T- Ratio = (0.647) (0.217) (1.180) (2.271) R- Square = 0.901 Adjusted R2 = 0.802 Standard Errors = (32926.229) (1.507) (1.043) (2.1031) F- Statistic (3,3) = 9.118 Durbin-watson = 2.215

4.3.2 INTERPRETATION OF REGRESSION RESULT The co-efficient of determination (R2) shows that 90% of the variation in the dependent variable (GDP) is explained by the independent variables (import, export, FDI). This means that only 10% of the variation in GDP is explained outside the model.

The result shows that only an import indicator has a negative relationship with gross domestic product (GDP) in the model while others were positive related. By making use of two tailed-test at 0.05 level of significance, 3 degree of freedom, the critical value of t* or table value = 2.571. Hence, since tc is less than t* (2.571) H0 should be accepted and we do not accept H1. Also, F- Statistics confirms the statistical insignificance of globalization in preSAP globalization and sustainable development since fc (9.118) is less than F* (9.28).

45

The Durbin-watson statistic falls between 0and 3, which is 0<2.215<3, it is however, concluded that globalization in pre-SAP period and sustainable development in Nigeria are positively auto correlated.

4.4.1 PRESENTATION OF REGRESSION RESULT FOR HYPOTHESIS TWO (SAP PERIOD) GDP = -654909.4- 0.802 + 1.739 + 21.067 T- Ratio = (-2.148) (-1.066) (5.193) (4.624) R- Square = 0.978 Adjusted R2 = 0.974 Standard Errors + (304873.48) (0.753) )0.335) (4.556) F-Statistic (3,16) = 241.423 Durbin-watson = 1.472

4.4.2 INTERPRETATION OF REGRESSION RESULT THE CO-EFFICIENT OF determination (R2) shows that 97.8% of the variation in the dependent variable (GDP) is explained by the independent variables (import, export FDI). This means that only 2.2% of the variation in GDP is explained outside the model.

The result shows that only import indicator has a negative relationship with gross domestic product (GDP) in the model while others were positively related.

By making use of the two tailed-test 0.05 level of significance, 16 degree of freedom, the critical value of t* or Table value = 2.101. Hence, since tc (4.624) is greater than t* (2.101) H1 should be accepted and we do not accept H0.
46

Also, F-Statistics confirms the statistical significance of globalization in SAP period and sustainable development since Fc (241.423) is greater than F* (3.24). Likewise, the Durbin-watson statistics falls between 0and 2, which is 0<1.472<2. it is however, concluded that globalization in SAP period and sustainable development are strongly auto correlated.

47

CHAPTER FIVE (SUMMARY, CONCLUTION AND RECOMMENDATION OF THE STUDY) 5.1 SUMMARY

This research work studies the effect of globalization on sustainable development in Nigeria with special reference to the challenges posed by globalization to the economy.

The study also presents adequate conceptual clarification for globalization and sustainable development in Nigeria context.

It also X-ray the historical background of the term globalization, economic history of Nigeria, globalization, policies and strategies for sustainable development in the country for vis-a vis SAP, NEPAD and privatization.

5.2 CONCLUTION Without an hiatus of daunt globalization is a late tool towards achieving sustainable development in Nigeria as shown in the empirical finding and the Nigeria economic growth rate over the years.

However, it is worthy of note that the Nigerian economy need to be diversified because the major composition of gross domestic product is accounted to crude oil export. In the opinion of usman cited in ibid, Nigeria economy must not only diversified but also built on sound economy policies including those that will necessarily
48

ensure increase domestic financial sector; opening up to foreign capital inflow, while simultaneously protecting the country from the huge destabilizing effects of short term speculative capital inflows, and together with other developing countries, continue to champion the necessity for the reform of the global financial that will ensure shares prosperity and a greater inducement to the development of the weaker countries. Also, as stressed in the national human development report, there must be a strong and vibrant civil society, good governance, affective dynamic relationship between people and the government and entrusting the management of the state in the hands of men and women of high technical competence and integrity.

5.3 RECOMMENDATION To fully annex the benefit of globalization in Nigeria, government and policymakers should work towards the following: i) ii) iii) iv) v) vi) vii) Agricultural sector reform. Improve the technological base of the country. Encourage domestic savings. Good governance. Value re-orientation. Population control measures. Provisions of basic infrastructural facilities most especially electricity and good road network. viii) ix) x) Healthy investment climate to attract foreign direct investment. Strict monitoring on the activities of multinational companies. Efficient and effective economic management.
49

REFERENCES Aina, T . A (1996).globalisation and social policy in africa. CODESRIA Bulletin,4. Andrea Maneshin (2006) Globalisation and Economic development; Some Eighteenth-century views (a paper presented at the fifteenth anniversary conference of the graduate program in economic and development. Asaju, A. s. (2002). Globalisation, urban property market and the search for sustainable city development.(pp. 316-324) in A. Amole, A. Ajayi and A Okewole (eds.), A conference proceeding on the city in Nigeria; perspectives, isssues, challenges, strategies. Ile-ife; O.A.U. Axel Dreher (2003). Does globalisation affect growth? Bathley, R. 1994 privatisation; can government manage it. urbanAge, 2(4); 3-6. CBN Economic & financial review 1981-1986. CBN Statistical Bulletin, vol.17, Dec.2006. Emmanuel chike onwuka and Agatha eguaven (2006). Globalisation and Economic Development;the Nigerian Experience Journal of social sciences (kamla-Raj) 14 (1); 45-51. Gbenga Lawal (2006). Globalisation and Development; the implications for the African Economy. Humanity and social sciences journal 1 (1);65-78. Hicks, J.R. (1946). Value and capital (2nd ed.). Oxford; oxford university press.
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 Kwanashie, M. 1998. the concept and process of globalisation. Central Bank of Nigeria Economic and Financial Review. Lan Goldin & Kenneth Reinert (2007). Globalisation for Development Trade,Finance Aid, Migration, and Policy. Leke Oduwaye (2006), Effect of globalisation on cities on developing countries journal of social sciences (kamla- Raj), 12 (3); 199-2005. M. L Jhingan (2005) Develomental Economics. Musa jega Ibrahim(2001), The Effects of Globalisation on the Development of Underdeveloped Economies and Policies. Journal of Economic Management 5910; 1-35. Obadan, M. I 2001. Africa and the Challenge of Globalisation;How should the continent respond? Nigerian Journal of Economic Management, 5 (1); 1-38. Onyeonoru; Globalisation and industrial performance in Nigeria (2003). Africa development, vol.xxviii; Renu Khatoor and Lisa Fairchild (2007). The Evolution of sustainable Development. Robert W. Kates, Thomas M. Parris, and Anthony A. Leiserowitz (2005). What is sustainable development? Goals, indicators, values and practice, 47(3);10-11 The university of reading ECIFM UNITED NATIONS: New York and Geneva (2OO8). Measuring sustainable development. Report of the Joint UNECE/OECD/Eurostat, Working Group on Statistics for Sustainable Development.

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