THE POLITICS OF PRIVATIZATION UNDER PRESIDENT OBASANJO ADMINISTRATION
(1999-2007):(A CASE STUDY OF THE BUREAU OF PUBLIC ENTERPRISES)
ABSTRACT
This project work systematically and rigorously examines the process of privatization in Nigeria Politics. Privatization aims at filling the loopholes created by State Owned Enterprises (SOES), which has come under great attack in Nigeria especially in recent times (under this forth republic), possibly due to the way that it is being pursed. This project work therefore, views the contending issues concerning it critically looking at the pros and cons of its and advancing further to specifically analyze the effects of a privatized economy in a developing country as Nigeria. It is in this light that the issues of corruption, inequality, insecurity, unemployment, etc, are systemically analyzed in relation to privatization.
TABLE OF CONTENTS
CHAPTER ONE: INTRODUCTION
1.1.    Background of the Study
1.2.    Statement of Research Problem
1.3.    Objectives of the Study
1.4.    Hypothesis
1.5.    Significance of the Study
1.6.    Scope of the Study
1.7.    Limitation of the Study
1.8.    Definition of Terms
CHAPTER TWO: LITERATURE REVIEW
2.1    Privatization in Nigeria
2.2    Theoretical Framework
2.3    The Debate on Privatization
2.4    Privatization: Politics or Professionalism
CHAPTER THREE: RESEARCH METHODOLOGY
3.1.    Introduction
3.2.    The Research Design
3.3.    Population of the Study
3.4.    Sample Size
3.5.    Sampling Techniques
3.6.    Method of Data Collection
3.7.    Instrument used and method of Data collection
3.8.    Validity and Reliability
3.9.    Administration of the Instruments
3.10.    Method of Data Presentation
CHAPTER FOUR: DATA PRESENTATION, ANALYSIS AND
              TESTING OF HYPOTHESES
4.1.    Introduction
4.2.    Data Collection
4.3.    Method of Data Presentation and Analysis
4.4.    Data Presentation
4.5.    Testing of Hypothesis
CHAPTER FIVE: FINDINGS, CONCLUSION AND
            RECOMMENDATION
5.1.    Research Findings
5.2.    Conclusion
5.3.    Recommendation
Bibliography
Appendix
CHAPTER ONE
INTRODUCTION
1.1.    BACKGROUND TO THE STUDY
Privatization is one touchy issue on the growth and development of Nigeria today that cannot be overlooked by policy makers of our time. Privation is a very sensitive contemporary issue that has gained and continued to gain or attract much attention of this present era. Many nations have been frantic in their adoption of privatization in order to achieve a couple of macroeconomic goals.
By definition, privatization connotes the selling off of state, owned Enterprises (SOEs) or assets to the private Sector, Ademolekun and Laleye (1986). In the words of Zaza (2002) it means the shifting of ownership of Government entities to private hands.
Privatization has become a household name since nationalization went out of fashion and it has pervaded most countries economies both developed and developing.
It started in Latin America, specifically Chile. It was much frenzy when it started in great Britain,  under the tutelage of the then prime minister Margaret Thatcher when in the 1980S the British government sold off state assets worth about $29billion, roughly halving the size of the public sector.
This was due to her determination to roll back the public sector substantially so as to enhance the private sector in the effective and efficient provision of public utilities and services, being regarded as safe from denationalization (Ibie, 1996:2).  Only very recently, have some African state, e.g. Nigeria, Ghana,
Sierra Leone, etc, taken steps towards privatizing state assets, or at least increasing private sector involvement.   Since 1992, states in the United States have been allowed to privatize their infrastructure, and faced with budget problems; the idea of privatization has since continued to rage in the united State. The administrations of president William Jefferson Clinton, a liberal (or American socialist) and president George W. Bush, with a corporatist cabinet (former corporate executives) has pursued it with greater vigour even though America politicians and economists, For example, President Clinton reverted the ownership of the new media from public control to private hands when he signed the Telecommunication Act in 1996. The 1996 legislation rescinded the Federal Communication Act of 1934, which had treated radio transmission as a public utility worthy of government protection. Despite these postures, the September 11th attack on the twin tower has made many US citizens to once again recognize the importance of regulating policies and government protection.  
Privatization is now being impressing on third world nations and should be rigidly followed for there to be no strain in relationship between the North and south country, if the former should continue to aid poor nations, etc. (Ademolekun and Laleye, 1986:13).
Considering the trend or situation of our country, Nigeria today, it seems therefore that there is no option for Nigerian leaders but to privatize. However it is the method of privatization, more than just the need to privatize that is causing much concern.
There are of course different reasons given why government should choose to privatize. Among these two major reasons that stand out: One is to cut the size of the state sector (downsizing public assets) in pursuit of greater economic efficiency and the other is to raise cash. Privatization has become intense. Therefore, in an attempt by Nigerian leaders to revamp the ailing economy and to give succor to the already paralyzed government parastatals, enterprises, industries, etc, government has decided to increase private stakeholders. Of course, we have to agree with the fact that lack of managerial skills on the part of Nigerian government has done a lot of dangers if we take our mind back to the 1970s and early 1980s and ask what has happened to our airlines, ships, etc.
Secondly, the total neglect of the agricultural sector of the economy and the bad management of revenue accrued from oil, lack of executive capacity  and of purposeful planning and foresight has left Nigerian leaders gasping for breath (or is it the masses –the sufferers).  A good management of economic resources could have utilized the oil money for diversification of export earnings base and into other viable sectors or areas. Instead councils, states and the federal government embarked on expensive and gigantic programmers and project whose design and scope have no relation to the well being of the people.                        
 This created the era of debt for the nation when it borrowed from ‘’advisory’’ institutions like the Paris Club, IMF and the World Bank.  
Privatization and commercialization were the option, which have proved successful in increasing the efficiency of finance that had suffered from public sector control. Firms such as British Telecom and British Airways are now much more efficient and provide a better service that they did when owned by the State but at what price?
The issue is that while privatization has its benefits it also has its problems. Privatized companies are not performing as expected or envisioned by privatization proponents. Hence the question is: Is privatization the core route to national development?
Are there no better options? If we must privatize what things should be put into consideration?
This research work is therefore a critical look at the privatization process in Nigeria looking at both the positive and negative side and proffering a solution.
1.2     STATEMENT OF RESEARCH PROBLEM  
The application of privatization the programme in Nigeria as an ideology in addressing ailing economy has generating much reaction both negative and  positive from different sections of the public. This is due to the impact it is expected to have on the socio-political and economic life of the Nigerian citizenry. Hence in many quarters there has been skepticism about the privatization drive. Such skepticism stems from the assertion that establishment such NPA, NIPOST, NNPC, etc, are charged with the responsibility of providing social services that are quit strategic to the Nigerian economy and as caution should be taken against the transfer of such institutions to private hands whether local or foreign investors. Such institutions it is contended when placed in the hands of private investors will put many Nigerians at the mercy of such investors. (Ibie, 1996:14). Another feeling is that privatization is but another way of transferring public wealth to the hands of a few powerful in the society.
A major issue for the doubts enveloping the privatization process is: can privatization work in an economy that is characterized by corruption, poverty, unemployment, inequality, insecurity, etc?
For proponent of the privatization process, they have cited various advantages and use it as a yardstick in saying that there is nothing better than it possibly not taking the environment into consideration. Hence, the questions on every lip are.     
1.    Is the policy on privatization going to meet its aspirations or goals in Nigeria?
2.    Is privatization the best alternative development strategy for attaining an effective operation of public corporations in Nigeria?
3.    Are private owners better disposed towards efficiency and effectiveness than their counterparts in the public sector?
4.    Do private sectors expedite developmental process than public sector, that is to say, is it going to hasten national development in Nigeria?
For convenience, this will be the buildup problems in the stated project work. This is because this research works attempts to critically look at this privatization process in Nigeria, its problems and prospects and offer a way out.
1.3     OBJECTIVES OF STUDY
The major objectives of this research are:
1.     To determine the relationship between privatization and national development;  
2.    To give thorough view about the political impact of privatization on the Nigeria policy; and  
3.   To establish the truth in the assertion that privatization can improve our economy as well as all existing governmental corporations
1.4     HYPOTHESES
The hypotheses to be employed basically for this research work are as follows:
1.    Ho: There is no significant relationship between poor management and effective operation of state-owned enterprises in Nigeria.
      H1: There is significant relationship between poor management and effective operation of state-owned enterprise in Nigeria.
2.    H0: Privatization will not endanger inequality in income distribution.
     H1: Privatization will endanger inequality in income distribution.
3.    H0: Privatization will not endanger national security.
     H1 : Privatization will endanger national security.
4.    H0: Private owned enterprises are not less corrupted, inefficient than public sector enterprises.
    H1: Private owned enterprises are less corrupted, inefficient than public enterprises.
1.5     SIGNIFICANCE OF STUDY
This research work will probe into the various critical views of scholars/experts on privatization. This will enable us to look at both the positive and negative effects of privatization. It will look at the merit and perceived defects of privatization as an alternative development strategy to the ineffective operation of public corporation in Nigeria.
This project will also be of immense importance of future researchers willing to undertake and carry out investigation on the same or similar problems and it will serve as a source for further inquiry.
It will also invariably help in the enhancement and understanding of our economy, parastatals, industries, companies, etc, in relation to national development.
1.6     SCOPE OF STUDY    
•    Geographical Coverage: Due to the wide drive of privatization policy, this research work for obvious reason covered selected government- owned enterprises, parastatals and industries affected by the policy during the time under review in the geographical location known as Nigeria.
•    Time Horizon:    This research work was completed within eight (8) months of commencement.
1.7.    LIMITATIONS OF THE STUDY
There are several limitations which I invariably encountered in the course of carrying out this research. One common limitation considering the society we find ourselves was in the area of finance.  Insufficient finance negatively affected this because with more funds comes a lot of new opportunities which could have been exploited in the course of writing this project. This also limited me in acquiring some vital materials, e.g. sourcing materials from the internet. Secondly, since privatization happens to be a very recent topic in Nigeria developmental effort, there was the problem of dearth of resource materials. Also, time constraint was very crucial having combined academic work, with writing this project.
1.8     DEFINITION OF TERMS                                                                                                                                                                                                                                                                                                          In the analyses of this project topic, some conceptual clarification needs to be made here. Terms are defined herein in the context of their usage in this research and may not necessarily conform to their standard understanding in ordinary usage.
i.    Privatization: Privatization is the selling off, of government of state owned Enterprises (SOE) to private hand. According to pare to (1990:64) privation is a move by the public sector towards the pursuit of efficiency and effectiveness in the attainment of its objective with a dominance of financial consideration via the adoption of management styles that reward good and penalizes poor or bad performance.
ii.    Nationalization:  As used in this project work refers to the conscious process of concentrating or increasing the ownership structure of corporation, industries, establishment in the hand of local investors (both personal corporate and government).
iii.    Deregulation: Removing government supervision oversight, or control from the operation of business organization. Deregulation has come under constant criticism especially from the masses who believe that government has decided finally to leave them in the hand of profit motivated capitalist.
iv.    National Development: The term National Development implies, the ability of the country to increase its capacity in every sectors of the society Ajayi(1977:102).