Negative Effects of Nigerians Preference for Foreign Made Goods

Though the foreign consumption of Foreign Goods and Services has continued to read to raise or improve our collective standard of living, it is imperative to notes that's the negative consequences of this attitude has contributed to the presents come comatose state of the nations industrial sector. We now examine the overall impacts;

(1) Intensive competition with local companies
(2) Collapse of the industrial  sector (3)Unemployment/ job losses
(4) Balance of payment deflict
(5) Currency devaluation
(6) Capital fight
(7) Poverty
(8) Cultural imperialism

INTENSIVE COMPETITION; The invention of the Nigerian market by global companies armed with qualitative product at cheaper rate has giving rise to an intensive competition with locsl producers. A tipical example is the textile industry where report have it that imported Asian textiles to as have captured about 80% of Nigerian textile market as they are 20% cheaper than the local products. The collapse thethe Nigerian textile and tyre industries is primarily attributable to the competition in arising from the mainly made Asian product.

COLLAPSE OF THE INDUSTRIAL SECTOR;The dependence of Nigeria and Nigerians on imported products is one of the reasons that have led to the present comatose state of the industrial sector. As described above the preferences for the imported goods have compelled the manufacturing plants to produce that are quiet below the installed capacity. Other that cannot cope with this measure have closed shop while the Nigeria market place is dominated by foreign made goods. In the 70s and  80s the textile industry had about 200 companies today,about 30 companies are struggling to survive while producing at 30 percent installed capacity(The Guardian op.Cit).

UNEMPLOYMENT/JOB LOSSES;The collapse of the industrial sector is trailed by job losses which have increase the unemployment rate in the country. Many Nigerian manufacturers who forced out of the industrial sectors are now involved in trading and merchandising which promise immediate and profitable return,closing there plants and throwing thousands of workers into the labour market. As example,using the same textile industry will suffice, the industry had close to a million workers in the 70s and 80s,today with less than 30 companies about 28000 workers are said to remain and sustain the name of the industry.

BALANCE OF PAYMENT DEFICIT; Balance of payment is defined by Agbonifoh et all(2007;648)as the account that measures the net position of a nations international transaction. The International transactions involve the selling and buying of goods and services to and from a nation to several others. It also includes non trade activities such a overseas investments ,gifts or aids, foreign military activity etc the balance of payment is made up of 3 important amount capital,current and official reserves bank account. The current account which is of utmost important to us here international business is a record of all merchandise exports imports and services plus unilateral transfer of funds. Deficit balance of payment occurs when the total receipt from other countries fall short of the total payment to other countries. As Nigerian imports visible and invisible items in excess of the value of her exports,the balance of payment is usually in deficit except crude oil export play a role

CAPITAL FLIGHT; Capital flights occurs when foreign firms and their expatriate personnel repatraite profits made on business transactions in a host country to there own  home country. The multinational firms(MNCs) are usually involved and accused of this practice. Capital flights does not contribute anything to the development of host countries, as it drains the the capital in an already capital strapped nations especially the less developed countries(LDCs)

POVERTY; In the financial analysis, the importation of all sorts of items into Nigeria has increased the general state of poverty in Nigeria. As at 2005,the external Debt profile of the country, according to depth management office(DMO) stood at $32.916billion. A part from london Paris clubs,bulk of the external Debts came from multilateral and bilateral agreements and promissory note, documents used in international trade. As a consequence, observed that the world Bank(1996) estimates that 66 percent of the Nigerian population are living below the poverty line while the central bank of Nigeria(1997 annual report) showed that 69.2% of the population were Poor. The reason  is not far fetched. When almost all the companies in the country are operating quiet below installed capacity, the few employed Nigerians find it difficult to cater for their immediate and extended family members since this scenario reduces their purchasing power the ripple effect leads to subsistent living by the majority of citizenry.

CULTURAL IMPERIALISM; The multinational companies(MNCs) as drivers of globalisation have been accused of imposing Western cultural values and culture oriented values which give rise to Western cultural assimilation by consuming  nations of the world including Nigeria. In sociological parlance, this is called cultural imperialism.