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Bullion

Keywords

Import substitution, Economic policy, Monetary policy, Fiscal policy, Economic expansion

Abstract

The objective of this paper is to describe the import substitution policies of Nigeria with a historical and analytical outlook with a view to amplifying its dimensions of impact, and recommending potential options for optimizing policy and implementation. Method The methodology adopted for this paper is descriptive and historical analysis. Comparisons were drawn from various countries policies such as Chile, Brazil, Argentina, Mexico, India, South Korea, and the Philippines and outcomes are highlighted, and then extrapolated to the Nigerian context with a view to understanding the local context in the light of peer country implementation. The results from the implementation of Nigeria's import substitution policies have been varied and undulated. Specifically, in recent times, the 41 items policy, may be mixed in the short term, but strongly indicates a good outcome in the long run for the country. Domestic production, especially of commodities is on the uptick since the inception of the 41 items policy, and various other sectors, like manufacturing are witnessing significant gains in capacity expansion due to increased local demand. The Central Bank of Nigeria should harmonize its 41 items policy with other foreign exchange, currency management, and financial markets policies to ensure a coordinated focus and to forestall counteractions in outcomes on several simultaneous policy tracks. It should also measure the impact of the 41 items policy to examine and ensure that while preserving forex on one hand, the impact is not blunted on other fronts by hemorrhaging foreign exchange through leakages, round-tripping and transfer pricing

Author Bio

Dr. Paul Oluikpe is an associate Head, Financial Inclusion Secretariat, Development Finance Department of Central Bank of Nigeria

Publication Title

Bullion

Issue

3

Volume

44

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