CHAPTER ONE

INTRODUCTION

The attainment of advanced and developed stage in industrial and economic development by many countries of the world started with the small scale business (industries) particularly in the manufacturing sector.

In developing country, like Nigeria, the process of industrial and economic development is joint responsible of the fiscal and monetary policies of the government, the private and the public business enterprises and the individuals. However, the Nigeria economy is predominately characterized by economic lackage which causes structural imbalance always.

            It appeared that during the colonial era, mot of small scale industries mostly manufacturing industries were mainly subsidiary of foreign companies, implication of this is that most profit if not all profit made by these industries are transferred to their mother countries rather than using it in developing Nigeria. At worst, the 1973/74 oil book era shifted the business sector as well as individuals from production to the importation of mostly everything. Enugu state is not left in this quest. It should be mentioned that since 1970, Enugu state has not fashioned well in the industrial growth compared with states like Lagos, Kaduna and Kano but with the decline of foreign exchange earning which ahs reduced the crazy for the importation. Enugu state businessmen are now funding it necessary to industrialize by diversifying into productive sectors. Also considering the present economic situation in the country, the entrepreneurs in Enugu state now more than ever, need to branch out into some other areas outside buying and selling. This request is necessary because in Enugu State, most small scale business are buying and selling enterprises.

However, one would appreciate the fact that one may make quicker and more money by engaging in buying and selling but the process is characterized by numerous battle necks. Firstly, it is only for a short term investment in the production of physical goods though it has longer gestation and payback period thereby ensures a more lasting profit. Apart from being a safe investment for the entrepreneur in the long run but it is a sure way of providing employment opportunities for our secondary school holders even university graduates and undergraduates.

Furthermore, it is with mentioning that before the oil boom ear, the Nigeria economy was grossly characterized by low per capital income, low savings rates, low investments, low capital formation, employment problem and perennial balance of payment disequilibrium.  All the above economic and social ills were increased when the price of oil started deteriorating in the world market for instance this sorry state of affairs resulted in many able bodied Nigerians being under utilized and therefore cannot contribute positively to the production process with the  accompanying danger of anti-social activities.  The such down turn of the Nigeria economy in the past years made it difficult for most small scale business enterprises to prosper.

Based on this fact, it is no doubt that the immediate waking up of small scale industrial businesses especially in the manufacturing sector is the surest way of providing solution to the Nigerians present economic problems. Hence to reverse the trend of Nigerian’s erring economic possible available avenues of engaging our abundant human and material resources should be seriously sought and it could be easily sought through small scale industries.

In recognition of the role of small scale industries in the restricting and reconstruction of the Nigeria economy, both the government and the private sector of the economy are increasingly directing their effort and attention towards providing efficient services, infrastructural facilities and above all a conducive atmosphere for the existence of small scale business enterprises in Nigeria.

STATEMENT OF PROBLEM

The problems being faced by small scale industries in Enugu State are definitely contributing to show pace towards economic development.

            Enugu state is in eastern part of Nigeria and depends largely on its revenue from Agricultural establishment and small scale industries on the base that the contributions from the sectors towards the revenue of the state are so small, the people of Enugu state are complaining about the insignificant contribution.  Most people in the area feel that they have not performed to expectation when compare with their counter parts elsewhere. This ugly situation has raised my interest to look into and investigate on the operations of small scale industries with view of suggesting some means of solving and minimizing their problems.

1.2       PURPOSE OF THE STUDY

The purpose of the study is;

1.                  To identify the contributions of small scale industries to the economic development of Enugu State,

2.                  To investigate the problem that militates against small scale industries towards their effective contributions.

3.                  To offer solutions to identified problems and make necessary recommendations.

4.                  To motivate and encourage buying and selling enterprises to see that small scale (manufacturing) industries ensures more lasting profit and that is also a safe investment in long run.

SIGNIFICANCE OF THE STUDY

This investigation into the role of small scale industries in the economic development will be of use in the following ways;

1.                  It will expose the impact the small scale industries make towards the economic development to the government and researchers.

2.                  It will be of great importance to students and economist who will like to carryout further research on small scale industries.

1.4       SCOPE OF THE STUDY

This investigation is to cover all small scale industries in Enugu State but the relatively short time for the study and the inaccessibility of some of the business has limited it to some selected industries like;

1.                  Book food and packaging industry, 128. Agbani Road, Enugu.

2.                  Winners block industry, plot 10 Port Harcourt express way.

3.                  Nnagozie Bakery industry, 112 Nike road Abakpa Enugu.

4.                  Onward paper mile, 97 Zik Avenue Enugu.

5.                  Naiko Hotel 398 Agbani Road, Enugu.