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Nigeria’s Planning Experience

Efforts to plan the Nigerian economy date back to the end of the second world war when, in 1945, the colonial office requested the local administration to submit a 10-year development plan to guide it in the allocation of colonial development and welfare funds. This resulted in the “Ten-Year plan of development and welfare for Nigeria”. It was initially scheduled to last from 1946-1956. But by 1950, it was realised that it was not feasible to chart development over a period as long as ten years in a country that was undergoing rapid structural changes. A decision was, therefore, taken to break the plan into two five-year periods. A new plan for 1951-56 was therefore formulated. The next major effort to plan in Nigeria was in 1953 when the World Bank was invited to send an economic mission to Nigeria. The 1955-60 economic programme followed largely the recommendations of the World Bank’s report.

These pre-independence plans were actually prepared by colonial government officials, and consequently failed to satisfy an important requirement of good planning, namely, the involvement of the people whose welfare the plan is supposed to seek. Besides, these plans could not be regarded as systematic development plans because they were just collected projects and programmes not systematically integrated.

(a) First National Development Plan (1962-1968)

Systematic development plans started immediately after the political independence. Thus, the first National Development Plan (1962-68) was launched in 1962. This plan has been described as the first national plan, partly because it was the first attempt to integrate both the federal and the state’s programmes. Total capital expenditure for the period was put at ₦254,854 million with a projected growth rate of G.N.P of 4% per annum. The period witnessed improvements in roads construction, the establishment of light industries to process agricultural raw materials, the encouragement of agricultural development and the construction of Kainji Dam.

The plan, although beset with numerous problems including heavy reliance on foreign experts and the outbreak of the civil war, was able to achieve a growth rate of 4.4%.

(b) Second National Development Plan (1 970-1974)

The events of 1966 and the resulting crisis of 1967-69 made it impossible for the country to start the formulation and design of the second National Development Plan. The second national plan therefore, started from 1970-1974. It started from the premise that the civil war only worsened an already defective economic structure. Thus, the plan sought to correct, through comprehensive planning, the various defects by a combination of policy reforms and new direct public investment programme.

The broad objectives of the plan were to establish Nigeria firmly as a united, strong and self-reliant nation; a great and dynamic economy, a just and egalitarian society, a land of bright and full opportunity for all citizens, and a free and democratic society. During this plan period, average annual growth rate of 7 percent was expected. However, GDP at 1974-75 factor cost showed an average growth rate of 8.2 percent in 1970-71. This compares favourably with 7.0 percent projected by the plan.

However, the growth rate of the economy fluctuated throughout this plan period. It fell from 18.4 percent in 1971-72 to 7.3 percent in 1972-1973, rising thereafter to 9.5 percent and 9.7 percent in 1973-1974 and 1975 respectively. It is important to mention that during this plan period, especially its later years, the oil boom brought about budgetary and foreign exchange resources that were greater than expected and this helped to remove the financial constraints towards achieving development objectives. The absorptive capacity of the economy did not, however, expand simultaneously and, hence, there were delays in project preparation. There were also weaknesses in manpower planning and development and shortages in construction materials.

(c) Third National Development Plan (1 975-80)

The third plan (1975-80) was prepared using a different machinery from that of any of the previous plans. It was the first plan in Nigeria to be prepared by a professional planning body in the central planning office of the Federal Ministry of Economic Development and Reconstruction. Total planned investment for the period was ₦30 billion while the anticipated growth rate was 11%. Estimates of GDP at 1977-78 factor cost grew from a level of ₦27,365 million in 1975-76 to ₦35,196 million in 1979-80. This represents an average growth rate of only 5.0% per annum compared with the planned average growth ratio of 9.5% per annum.

The fastest growing sector over the plan period was manufacturing which recorded an average growth ratio rate of 18.1 per annum. Structurally, agriculture, mining and manufacturing were respectively projected to account for 22.6%, 44.2% and 5.5% of the constant price GDP in 1975-76. However, actual estimates indicated that the shares of these three sectors were 27.3%, 22.5% and 5.6% respectively during the period. In all the period witnessed general improvements in infrastructure especially roads.

(d) Fourth National Development Plan (1981-1985)

Planned expenditure for the period was ₦82 billion with an anticipated growth rate of 7%. The major aims of this plan were generally the same as those of the previous plan. Indeed, priorities were placed on housing, development of local government and the development of agriculture. Unfortunately the dwindling oil revenue arising from the world oil glut accounted for the delay in many of the projects.

By 1985, Nigeria had amassed 25 years of planning experience and yet the economy remained extremely poor, and majority of the citizens could still not afford three square meals a day. Therefore, in order to improve plan implementation in Nigeria, government now operates national rolling plan which has a long-term perspective and a feedback mechanism which enables one to determine whether all the stages and processes of an operation are in conformity with objectives of the nation, Even with this new plan, inadequacy of financial resources still hinders its implementation.